Oil prices below $97 as traders await key events
Oil prices traded virtually flat below $97 a barrel Tuesday as traders awaited a raft of news in Europe and the U.S. over the rest of the week that could have a big bearing in financial markets.
As well as a raft of scheduled events this week related to Europe's debt crisis, traders are waiting to see if the Federal Reserve will back another monetary stimulus on Thursday following a two-day policy meeting. Speculation that the Obama administration was preparing for a release of strategic oil reserves also kept the buying in check.
By early afternoon in Europe, benchmark crude for October delivery was up 6 cents to $96.60 a barrel in electronic trading on the New York Mercantile Exchange. The contract finished up 12 cents to $96.54 on Monday on the Nymex.
In London, Brent crude, used to price international varieties of oil, was up 9 cents to $114.90 on the ICE Futures exchange.
Natalie Rampono, commodities analyst at ANZ Banking Group in Melbourne, Australia said one factor weighing on prices was speculation that the administration of President Barack Obama was closely studying the possibility of an emergency release of oil reserves in order to keep prices down.
On Friday, the U.S. government reported the economy added a weaker-than-expected 96,000 jobs last month, increasing the likelihood of another round of stimulus from the U.S. Federal Reserve when its policy makers meet later this week.
That belief has helped support oil prices in recent days, Rampono said.
Investors will also be monitoring new information on U.S. stockpiles of crude and refined products.
Data for the week ending Sep. 7 is expected to show draws of 3.3 million barrels in crude oil stocks and of 2.3 million barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.
The American Petroleum Institute will release its report on oil stocks later Tuesday, while the report from the Energy Department's Energy Information Administration — the market benchmark — will be out on Wednesday.
In other Nymex energy futures trading, wholesale gasoline was up 0.6 cent to $3.03 a gallon. Heating oil added 0.37 cent to $3.1705 a gallon, while natural gas rose 0.3 cent to $2.815 per 1,000 cubic feet.
Pamela Sampson in Bangkok contributed to this report.