Investing.com - West Texas Intermediate oil futures were lower on Thursday, as investors awaited the release of weekly supply data out of the U.S. later in the session to gauge the strength of oil demand from the world’s largest consumer.
The report comes out one day later than usual because of the U.S. Labor Day holiday.
On the New York Mercantile Exchange, crude oil for delivery in October declined 0.89%, or 85 cents, to trade at $94.69 a barrel during European morning hours.
Prices held in a narrow range between $94.66 and $95.28 a barrel. Futures were likely to find support at $93.06 a barrel, the low from September 3 and resistance at $95.91 a barrel, the high from September 2.
Thursday’s government report was expected to show that U.S. crude oil stockpiles fell by 1.2 million barrels last week, while gasoline stockpiles were forecast to decrease by 1.4 million barrels.
After markets closed Wednesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories fell by 545,000 barrels in the week ended August 29, compared to expectations for a decline of 1.0 million barrels.
The report also showed that gasoline stockpiles increased by 362,000 barrels, while distillate stocks rose by 385,000 barrels.
On Wednesday, U.S. oil prices surged 2.86%, or $2.66, to end at $95.54 a barrel following reports that Ukraine and Russia had reached a ceasefire agreement in eastern Ukraine.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for October delivery slumped 0.7%, or 72 cents, to trade at $102.05 a barrel. London-traded Brent prices rallied 2.42%, or $2.43, on Wednesday to settle at $102.77.
Focus turns to the European Central Bank's policy meeting later in the day, amid speculation the central bank could unveil fresh stimulus measures to fight inflation and boost growth.
Market players are hoping the meeting will shed further light on the bank's plans to start asset purchases, a move that would work in favor of the dollar's strength.
Investors also looked ahead to Friday’s U.S. employment report for August for further indications on the strength of the recovery in the labor market, a key factor in deciding the future path of monetary policy.
While the U.S. economy continues to gain steam, Federal Reserve Chair Janet Yellen has expressed concern over slackness persistent in the labor market.
On Thursday, the U.S. is to release trade-balance data, the ADP report on private-sector job creation and the weekly report on initial jobless claims. Also on Thursday, the ISM is to publish a report on U.S. service sector activity.
A recent batch of upbeat data underlined optimism over the strength of the economy and fuelled expectations that the Fed will begin to raise rates sooner than previously thought.