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Oil prices fall after overnight rise on cold US weather

Oil prices fall after overnight rise on cold US weather

Oil prices fell Tuesday as traders looked ahead to a report showing U.S. crude stocks rising for the seventh week in a row.
The easing of prices came after cold weather across the U.S. Midwest and Northeast had helped push heating oil prices to fresh records.
But surging demand is expected to result in a decline in distillate stocks, which include heating oil and diesel, in the closely watched weekly U.S. petroleum supply snapshot to be released Wednesday.
The report by the U.S. Energy Department's Energy Information Administration is tipped to say that stocks of distillates fell 2 million barrels for the week ended Feb. 22, according to a Dow Jones Newswires poll of analysts' estimates. Vienna's JBC Energy, in its daily newsletter said the expected drop in distillates is anticipated "despite an expected increase in (U.S.) refinery runs."
The EIA report is also expected to show that crude oil stocks rose last week by 2.6 million barrels, which would be the seventh straight week of gains. Gasoline inventories are tipped to rise by 300,000 barrels.
Light, sweet crude for April delivery dropped 22 cents to US$99.01 a barrel by afternoon in European electronic trading on the New York Mercantile Exchange. The contract gained 42 cents to settle at US$99.23 a barrel Monday.
Heating oil futures lost less then a cent to fetch US$2.7820 a gallon (3.8 liters), after settling at a record US$2.7853 a gallon.
In other Nymex trading, gasoline prices slipped more than a cent to US$2.5290 a gallon while natural gas futures rose by more than a cent to US$9.2 per 1,000 cubic feet.
In London, Brent crude futures lost 5 cents to sell for US$97.64 a barrel on the ICE Futures exchange.
The rise in crude futures has also been driven by heightened supply concerns amid a Turkish military incursion into northern Iraq and warnings by Iran against further international sanctions.
Some analysts noted that some investors had invested heavily in crude, betting that prices will continue to rise, and that this was likely to contribute to volatility in the market.
Over the last few trading sessions, threats to oil supplies in producing nations have been balanced by expectations of lower demand due to the slowing U.S. economy. Small developments on both sides of that equation sent the market higher and lower throughout Monday's session.


Updated : 2020-12-05 02:58 GMT+08:00