Oil fell near $69 a barrel as crude inventories at a key storage hub in the U.S. were seen rising a fourth straight week and after the dollar strengthened.
Futures in New York slipped as much as 0.8 percent. Stockpiles at the Cushing hub in Oklahoma increased 600,000 barrels in the week ended Aug. 31, a forecast compiled by Bloomberg showed. A four-day rally in the greenback also decreased the appeal of dollar-based commodities. Meanwhile, Tropical Storm Gordon is expected to make landfall along the U.S. Gulf Coast Tuesday night.
While the U.S. benchmark has rebounded from the lows of August, America’s record production and growing supplies at the Cushing hub are causing it to lag a rally in international prices. Iranian President Hassan Rouhani on Tuesday pledged to keep exporting crude despite U.S. sanctions that are scheduled to go into effect in early November.
West Texas Intermediate for October delivery declined as much as 57 cents to $69.30 a barrel on the New York Mercantile Exchange and traded at $69.39 at 9:15 a.m. in Tokyo. The contract rose 7 cents to $69.87 on Tuesday from Friday’s close. Monday trades were booked Tuesday because of the U.S. Labor Day holiday. Total volume traded was about 68 percent below the 100-day average.
Brent for November settlement dropped as much as 35 cents, or 0.5 percent, to $77.82 a barrel on the ICE Futures Europe exchange. Prices on Tuesday climbed 2 cents to $78.17. The global benchmark crude traded at at a $8.78 premium to WTI for the same month.
Source : Bloomberg