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Oil futures dropped on Tuesday, a day after the announced drop in Iranian exports, and a preliminary trade agreement between the United States, Canada and Mexico contributed to higher world and US prices reaching their highest levels. level in almost four years.
Investors were waiting for weekly data, expected Wednesday morning, which should reveal a second consecutive rise in crude oil inventories in the United States.
November West Texas Intermediate crude
CLX8, -0.04%
The US benchmark dropped 27 cents, or 0.4%, to $ 75.03 a barrel on the New York Mercantile Exchange. December Brent
LCOZ8, + 0.02%
decreased by 30 cents, or 0.4%, to $ 84.68 per barrel on the ICE Futures Europe market.
On Monday, the two contracts have moved closer to their highest level since the fall of 2014, according to FactSet data.
"The next step in the oil sector may well be the weekly supply report," said Phil Flynn, Senior Market Analyst at Price Futures Group.
The American Petroleum Institute will release its weekly report on oil supplies on Tuesday Tuesday, covering the week ended September 28th. Official government data provided by the Energy Information Administration will be released on Wednesday morning.
The numbers come as refineries perform seasonal maintenance work, which could lead to an increase in oil inventories, but the oil supply could also fall because "the export window is large open, "according to Flynn.
Analysts surveyed by S & P Global Platts expect the EIA to report a weekly increase of 2.76 million euros for domestic crude supplies. This would be the second consecutive weekly increase reported by the EIA. Gasoline deliveries are expected to decrease by 672,000 barrels, while distillates would decrease by 1.83 million barrels, the survey said.
Last week, the EIA report showed that domestic crude supplies had increased by 1.9 million barrels for the week ended Sept. 21, marking the first increase in six weeks.
On Nymex gasoline Tuesday, November
RBX8, -0.08%
decreased by 0.4% to $ 2.119 per gallon and November fuel oil
HOX8, + 0.00%
paid 0.3% to $ 2,400 per gallon.
Natural gas prices continued to rise sharply compared to the previous day, with natural gas in November.
NGX18, + 2.04%
$ 3.15 per million British thermal units, up 1.8%.
"Unusually low storage levels continue to signal potential volatility and upside risk for first month contracts in the winter," said Robbie Fraser, commodity analyst at Schneider Electric.
Oil traders attributed a recent sharp rise in crude oil to Iran's exports, which preceded US oil-specific sanctions against Tehran, which are expected to come into effect early next month.
Bloomberg data based on oil tanker tracking reports indicate that shipments of Iranian crude dropped to 1.72 million barrels a day in September, a drop of 260,000 barrels a day since August, representing lowest since February 2016.
In May, President Donald Trump released the United States from a 2015 international agreement to curb the Iranian nuclear program, paving the way for the reimposition of economic sanctions in November.
Matt Smith, Director of Commodity Research at ClipperData, told MarketWatch that the strength of the dollar, along with the ICE US Dollar Index
DXY, + 0.09%
gaining 0.3%, created some resistance for oil on Tuesday.
Prices climbed on Monday following the update of a North American Free Trade Agreement, now called the US-Mexico-Canada Agreement, or USMCA, which has heightened demand expectations. of oil. Global equities, however, have lost their concern over a possible conflict between Italy and the European Union, which could harm the EU economy and appetite. petrol.
Political nervousness was driving risk appetite with the S & P 500 Index
SPX, + 0.05%
headed lower.
That said, the rise in crude prices remains in effect.
"I think the push we made to reach multi-year highs on Brent means that nothing really stops things from going higher," Smith said.
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