Crude Rebounds From 5-Month Low On Demand Hopes

Crude oil rebounded from the lowest level in five months after the American Petroleum Institute (API) showed that gasoline stocks fell 4.3 million barrels last week, far below analysts' expectations of a 338,000-barrel fall, improving the outlook for demand.

Distillate fuel stockpiles, which include diesel and heating oil, fell by 2.73 million barrels compared with expectations of a 1.3 million-barrel drop, while crude inventories rose by 871,000 barrels to 382 million barrels, the seventh straight weekly increase.

Investors are now waiting for stockpile data from the US Energy Information Administration (EIA) for clarity on demand. Crude supplies may have expanded for a seventh week by 2.1 million barrels while gasoline probably fell by 400,000 barrels.

- WTI crude oil futures for December is trading around $93.92 a barrel after rising $0.55

- Brent futures for December settlement is trading around $105.98 a barrel after rising $0.65

Gains however may be limited due to worries from the continued turmoil in Libya. The prolonged damage to supplies could tighten an already delicate global supply-demand balance at winter season is around the corner when demand for heating fuels rise.

Investors are also watching the latest services and retail sales numbers released from the eurozone today and the leading indicators from the US; tomorrow investors await monetary policy decisions from central banks in UK and Europe, as well as key data from the US.

The continued progress in talks between Iran and the West is taking some of the risk premium away from the market, weighing on oil prices. Iran's top negotiator said that a framework deal over Tehran`s nuclear program is possible this week.

- Natural gas is trading at $3.475 per cubic feet after rising 0.26%

- Gasoline is trading at $2.5471 per cubic feet after rising 1.23%

- Heating oil (diesel) is trading at $2.8847 a gallon after rising 0.72%