Crude oil is seen steady on Tuesday above the $103 a barrel mark. U.S. crude inventories are expected to fall for a second week. The bloodshed in Egypt stoked concern that Middle East supplies may be disrupted, and Greece was granted a last tranche of aid.
Crude supplies probably dropped by 3.1 million barrels last week, according to tomorrow's Energy Information Administration report. A report from the American Petroleum Institute today may also show crude stocks fell last week, as demand is recovering.
Egypt’s crisis is still scaring the market. The poltical turmoil is sparking worries that the mounting tensions could disrupt oil shipments through the Suez Canal.
- Crude is trading around $103.22 a barrel after rising $0.08
- Brent is trading around $107.34 a barrel after falling $0.09
The weakening U.S. dollar is also adding to the upside pressures on oil prices. The strong employment report last week fueled expectations that the U.S. Federal Reserve could start winding down its stimulus program later this year.
On Monday, the eurozone’s finance ministers decided to grant Greece the last substantial tranche of aid worth $8.7 billion, easing worries over the region’s debt crisis. However, Greece will receive the funds in installments to keep pressure on Athens to make reforms.
In China, the annual consumer inflation accelerated more than expected in June to 2.7%. Food costs soared, limiting room for the People`s Bank of China to loosen policy to stimulate the slowing economy, which may add downside pressures on commodities.
- Natural gas is trading at $3.736 per cubic feet after falling 0.13%
- Gasoline is trading at $2.8812 a gallon after falling 0.09%
- Heating oil is trading at $2.9799 a gallon after falling 0.01%