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Crude oil drops below USD100 a barrel ahead of U.S. supply data

Published 10/21/2013, 08:52 AM
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Investing.com - U.S. traded crude oil futures fell below the key USD100-level for the first time since July on Monday, as market players shifted their attention back to the resumption of government inventory data, which had been delayed due to the 16-day U.S. government shutdown.

On the New York Mercantile Exchange, light sweet crude futures for delivery in December traded at USD99.96 a barrel during U.S. morning trade, down 1.15%.

New York-traded oil futures fell to a session low of USD99.81 a barrel earlier in the day, the weakest level since July 2.

The December contract ended 1.58% lower at USD100.87 a barrel on Friday.

Oil futures were likely to find support at USD97.98 a barrel, the low from July 2 and resistance at USD101.70 a barrel, the high from October 18.

U.S. crude prices have been on a downward trend in recent sessions amid concerns the recent U.S. government shutdown created a drag on economic growth and eroded demand in the world’s largest oil consumer.

The U.S. Energy Information Administration will publish it weekly oil supply report covering the week ended October 11 later in the session.

The report was expected to show that U.S. crude oil stockpiles rose by 2.2 million barrels last week, while gasoline inventories were forecast to increase by 110,000 barrels.

The American Petroleum Institute, an industry group, said last week that U.S. crude inventories rose by 5.9 million barrels for the week ended October 11.

The EIA’s data-release schedule will return to normal later in the week, with the publication of October 18 storage data due on Wednesday, October 23.

Investors were also awaiting key U.S. data points later in the week in order to determine the impact of the government shutdown on the Federal Reserve's stimulus program.

The September nonfarm payrolls report, which had been originally scheduled for release on October 4, was due on Tuesday.

Oil traders have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Federal Reserve to reduce its bond purchases.

The central bank is scheduled to meet October 29-30 to review the economy and assess policy.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for December delivery shed 0.5% to trade at USD109.44 a barrel, with the spread between the Brent and crude contracts standing at USD9.48 a barrel.

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