LONDON: Brent crude oil futures fell to around $108.40 a barrel yesterday as investors assessed the aftermath of super storm Sandy, while US futures gained on the back of larger than expected crude oil stock draws and US manufacturing data.
The destruction wrought by the storm affected millions of people across the eastern United States and could dampen fuel demand just as the world’s largest economy was showing signs of recovery, analysts said.
The pace of growth in the US manufacturing sector picked up modestly in October as new orders improved, though a measure of employment slowed. The Institute for Supply Management (ISM) said its index of national factory activity rose to 51.7 from 51.5 in September, topping expectations.
Brent crude for December delivery fell 33 cents to $108.37 a barrel by 1530 GMT. The front-month contract slipped for a second straight month in October on ample crude supply and worries about lower fuel demand as the global economy slows. US crude for December delivery was at $86.99 a barrel, up 75 cents.
US crude oil inventories posted an unexpected draw last week while distillate stocks dropped less than forecast and gasoline supplies rose more than expected.
Crude inventories fell 2.05 million barrels, instead of a forecast 1.5 million barrel build. Distillate stockpiles slipped less than expected by 93,000 barrels. Petrol inventories rose by 935,0000 barrels, against forecasts for a 200,000 barrel rise.
Stocks were expected to increase by next week with more crude on its way after being held up by super storm Sandy and on the back of run cuts and outages at refineries due to the storm, explained Rob Montefusco, oil broker at Sucden Financial in London.
Reuters
