Oil prices hold their ground after falling on China stimulus
Shafaq News/Oil prices were little changed in early trading on Tuesday, awaiting furtherprice direction from OPEC's monthly report after China's stimulus plan andoversupply concerns took the wind out of markets in prior sessions.
Brent crudefutures fell 1 cent to $71.82 a barrel, by 0158 GMT. U.S. West TexasIntermediate crude futures were at $68.07 a barrel, up 3 cents.
Bothcontracts had fallen by more than 5% over the previous two trading sessions.China on Friday unveiled a 10 trillion yuan ($1.40 trillion) debt package toease local government financing strains, but analysts said it fell short of theamount of stimulus that would be needed to boost growth.
Furtherprice direction will come from the Organization of Petroleum ExportingCountries (OPEC) monthly report due to be released later on Tuesday. The marketwill be looking out for further downward revisions in demand from the group's outlookthrough 2025, which would add to downward pressure on prices.
"Prompttime spreads for Brent and WTI have collapsed recently, moving closer tocontango, suggesting a better-supplied physical market," ING analysts saidin a note.
When afutures market is in contango, contracts for prompt delivery are less than forfuture delivery, suggesting the market is well supplied in the near term orthat demand for oil is greater in the future.
The U.S.dollar closed higher on Monday as markets braced for further signals from U.S.inflation data and Federal Reserve speakers this week.
That makescommodities denominated in the U.S. currency, such as oil, more expensive forholders of other currencies and tends to weigh on prices.
(Reuters)
