West Texas Intermediate headed for its biggest weekly decline since January amid signs of weaker fuel demand in the U.S., the world’s biggest oil consumer. Its discount to Brent crude widened to the most in five weeks.
Futures traded in New York declined 4.4 percent this week as the dollar strengthened before data on U.S. employment today. The nation’s gasoline inventories rose to the highest level in four months last week as demand fell and crude output advanced to the highest since 1986 in early July, government data show. Brent is poised for a weekly decline amid speculation that energy supplies from Russia will be unaffected by further sanctions over Ukraine.
“Demand has been a bit sluggish,” Hannes Loacker, an analyst at Raiffeisen Bank International AG in Vienna, said by e-mail. “Shale oil growth in the U.S. and oil sands in Canada lead to the situation that geopolitical tensions are not weighing that strongly as in the past. It’s always about risk aversion too.”
WTI for September delivery declined as much as 73 cents to $97.44 a barrel in electronic trading on the New York Mercantile Exchange, trading for $97.53 at 9:49 a.m. London time. The volume of all futures traded was about 9 percent above the 100-day average for the time of day. Prices slid 6.8 percent last month, the most since May 2012.
Brent for September settlement fell 18 cents to $105.84 a barrel on the London-based ICE Futures Europe exchange. Prices are down 2.4 percent this week. The European benchmark crude was at a premium of as much as $8.33 to WTI, the widest on an intraday basis since June 24.
via Bloomberg 
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