NYMEX crude dips slightly in Asia as API drop fails to rally

Investing.com - Crude oil prices fell marginally in Asia on Thursday after U.S. industry stockpile data showed a fairly large drop in crude stocks ahead of key government data.

The American Petroleum Institute showed a 1.5 million-barrel decline in crude supplies, a 1.1 million-barrel build in gasoline inventories and a 1.3 million-barrel drop in distillate stocks in the past week in data released late Wednesday.

Analysts expect stockpile data from the government to see a fall of 750,000 barrels for the past week, a 1.333 million barrels drop in distillates and a 517,000 barrels in crease in gasoline.

The closely watched survey from the Energy Information Administration is due at 11 a.m. EST Thursday.

On the New York Mercantile Exchange, West Texas Intermediate crude oil futures for delivery in December traded at $76.89 a barrel, down 0.04%, after hitting an overnight session low of $76.88 a barrel and off a high of $78.06 a barrel.

Brent, the global benchmark, briefly slid below $80 a barrel in intraday trading on Wednesday. The front-month December contract settled down The front-month December contract settled down 1.6% at $80.38 a barrel on ICE Futures Europe, the lowest settlement since September 2010.

Overnight, crude futures fell on Wednesday amid sentiments that OPEC countries will leave output unchanged at a Nov. 27 meeting despite falling oil prices.

The Organization of the Petroleum Exporting Countries' monthly report released earlier showed that its collective crude output fell by 226,400 barrels a day in October to a total of 30.25 million barrels.

According to the agency, the decline was led by Saudi Arabia, which cut production by approximately 69,000 barrels per day to 9.6 million.

Despite the fall in OPEC output, market players remained concerned over a global supply glut, and expect that the Nov. 27 meeting in Vienna will lead to no major organizational decisions to trim global output by a significant amount to shore up prices.

Saudi Arabia has expressed a willingness to let prices slide on the presumed expectations that U.S. shale producers will halt operations as a result, as such production costs more than traditional drilling.

Once U.S. shale producers table their operations for profitability reasons, prices would presumably rise as the global economy absorbs excess supply.