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Thu 30 Aug 2012 11:43 AM

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Brent crude edges up toward $113, Bernanke speech eyed

Brent crude edged up toward US$113 a barrel on Thursday ahead of a meeting of central bankers later this week

Brent crude edges up toward $113, Bernanke speech eyed
Brent dipped earlier in the day as oil facilities in the Gulf of Mexico were largely spared storm damage.

Brent crude edged up toward US$113 a barrel on Thursday ahead of a meeting of central bankers later this week that will be scoured for clues on measures to boost global economic growth, while a potential strike by Norwegian oil workers also supported prices.

Brent dipped earlier in the day as oil facilities in the Gulf of Mexico were largely spared storm damage.

US crude futures fell as a surprise build in inventory in the world's top oil consumer and a possible release of strategic oil stocks weighed on prices.

Brent crude for October delivery rose 32 cents to US$112.86 a barrel by 0727 GMT. US crude slipped for a second session, down 33 cents to US$95.16.

Investors are now waiting to see whether US Federal Reserve Chairman Ben Bernanke will give any hint about further measures to support growth at the world's largest economy in a speech to fellow central bankers on Friday.

They are also eyeing more details from the European Central Bank on proposed bond purchases to tackle the region's debt crisis.

"If they are going to announce concrete ideas to support those countries in the euro zone it will be supportive for the euro and Brent crude," said Yusuke Seta, a commodities sales manager at Newedge Japan.

Technical charts showed that Brent is supported at US$111.50 a barrel, the 200-day moving average, he said.

"The Fed is likely to sustain its rhetoric to support the economy for as long as it can," Deutsche Bank analysts said in a note. Chances of more stimulus measures are slim as the US presidential elections draw closer, they said.

Investors are also keeping an eye on a possible strike by Norway's oil service workers that could disrupt supply from the world's eighth largest exporter.

This could be the workers' second strike in just over a month after they caused a partial shutdown of the country's oil and gas industry.

In the US, crude inventories unexpectedly rose last week while Hurricane Isaac, which was downgraded to a tropical storm, did not cause any discernible damage to refineries or offshore oil and gas platforms.

"We don't see any substantial impact from this hurricane so the risk premium has been removed," Newedge's Seta said.

US crude oil inventories rose 3.78m barrels in the week to August 24, the Energy Information Administration said on Wednesday, against expectations of a 1.5m-barrel fall.

Talks that consuming nations may release strategic oil reserves have also capped oil prices.

The White House reiterated on Wednesday that the option of releasing oil from the Strategic Petroleum Reserve remained on the table but it had no announcements to make.

Just a day earlier, the Group of Seven finance ministers expressed concerns over high oil prices and said they stood ready to call on the International Energy Agency to ensure the market is well supplied.

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