Oil slips below $104 as jobs data, Fed awaited
BANGKOK (AP) — The price of oil fell below $104 on Tuesday as traders await key data releases later in the week, including U.S. employment figures.
Benchmark oil for September delivery was down 71 cents to $103.84 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract fell 15 cents to close at $104.55 on Tuesday.
Brent crude, the benchmark for international crudes, fell 25 cents to $107.20 on the ICE Futures exchange in London.
Losses were kept in check as traders waited for the Federal Reserve to give its latest appraisal of the U.S. economy and whether a change to the central bank's stimulus strategy is warranted. Fed officials are meeting Tuesday and Wednesday in Washington.
The Fed has been buying $85 billion of financial assets a month in an attempt to keep long-term borrowing rates low and help shore up the U.S. economic recovery. However, the Fed is widely expected to wind down the program later this year if the economy improves.
Oil prices have gotten a boost from the low interest rates, which have made commodities like oil more attractive as investments.
On Friday, the release of employment data for July will be examined for hints about future energy demand in the world's No. 1 economy.
"We'll look to position ourselves for Friday's number and get a better gauge on how fast demand is growing and going," Carl Larry of Oil Outlooks and Opinions said in a commentary. "I think that demand is definitely more correlated to the number of people working, which in turn leads to a lot more drivers."
Traders are also looking to see whether Energy Department will report another draw in oil supplies after dropping by a surprisingly large 30 million barrels over the past month.
Oil supplies remain high compared with the five-year average, even after the monthlong reduction, so most traders say it is more likely that oil prices will soon fall than rise.
In other trading on the New York Mercantile Exchange:
— Wholesale gasoline fell 0.3 cent to $2.975 a gallon.
— Heating oil fell 0.7 cent to $3.013 a gallon.
— Natural gas fell 3.2 cents to $3.44 per 1,000 cubic feet.