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NYMEX crude oil up in early Asian trade as refiners buy on dips

Published 12/01/2013, 05:02 PM
Updated 12/01/2013, 07:32 PM
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Investing.com - Crude oil prices rose in early Asian trade Monday as refiners took advantage of recent price dips.

On the New York Mercantile Exchange, light sweet crude futures for delivery in January traded at USD93.19 a  barrel, up 0.50%,

Last week, U.S. oil futures lost 2.23%. For November, NYMEX crude oil saw a 3.2% monthly loss, as ongoing concerns over rising U.S. inventories and increased production levels weighed.

The U.S. Energy Information Administration reported Wednesday that crude oil inventories last week rose by 3 million barrels to 391.4 million barrels, the most since June.

Domestic output rose to 8.02 million barrels a day, the highest level in almost 25 years.

Concerns that the Federal Reserve will start to taper its bond-buying program at one of its next few meetings also weighed.

The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.

In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report for November. The Fed, which holds its next meeting on Dec. 17-18, has said the timing of its tapering depends on the health of the labor and housing markets.

Market players are also looking ahead to a meeting of the Organization of the Petroleum Exporting Countries in Vienna later this week. OPEC is forecast to keep its supply target unchanged at 30 million a day on Dec. 4.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for January delivery fell 1.06% on Friday to settle the week at USD109.69 a barrel.

The January Brent contract lost 1.22% on the week, amid expectations that more Iranian crude will come back to the market after Western powers reached a historic deal with Tehran over its nuclear program on Nov. 24.

Meanwhile, the spread between the Brent and the crude contracts stood at USD16.97 a barrel by close of trade on Friday, narrowing from more than USD19 a barrel on Wednesday.

Despite the weekly decline, London-traded Brent futures still rose 1.4% on the month amid ongoing concerns over a disruption to supplies from Libya.

Data released on Sunday showed that China’s manufacturing purchasing managers' index held steady at an 18-month high of 51.4 in November, compared to forecasts for a decline to 51.1.

China is the world’s second largest oil consuming nation and manufacturing numbers are used as indicators for fuel demand growth.

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