Crude-oil futures were mostly stable in Asian trade Tuesday,
after posting losses in the previous trading session.
On the New York Mercantile Exchange, light, sweet crude futures
for delivery in March traded at $45.27 a barrel at 0435 GMT, up
$0.12 in the Globex electronic session.
Brent crude for March delivery rose $0.16 to $48.32 a barrel on
London's ICE Futures exchange.
Oil markets appear to be consolidating with prices moving in a
narrow price range for most of January, but analysts said prices
are still at risk of falling further as the global oil surplus is
expected to continue to rise in the first half of this year.
China, the world's second-largest oil consumer, has lowered its
target for industrial-output growth to around 8% this year from
9.5% in 2014, as a slowing economy makes it difficult to boost
industrial activity, a ministry spokesman said Tuesday.
A further slowdown in China's industrial sector could reduce
demand for commercial fuels such as diesel and weigh on overall oil
demand growth.
However, low oil prices should provide a large boost to fuel
demand from China's transportation sector, which accounts for
around half of the country's total oil consumption, according to
Citi Research estimates.
"Brent prices have declined by around 60% since June, but that
has so far only translated to 20%-35% declines in Chinese oil
product prices," analyst Ivan Szpakowski said.
Monday's comments from OPEC Secretary General Abdalla Salem
El-Badri had a mixed impact on oil markets. He said insufficient
investment could push prices to $200 a barrel in time and prices
may have bottomed, but also added that OPEC intends to stick to its
decision to keep its output unchanged until its next meeting in
June.
Later Tuesday, the American Petroleum Institute will publish its
weekly U.S. oil inventory data. Financial markets will also be
tracking the two-day U.S. Federal Open Market Committee
meeting.
The global oil surplus and resulting accumulation of inventories
are still bearish for prices, and limit the potential for a
recovery, with new lows a possibility, analyst Tim Evans at Citi
Futures said in a report.
Nymex reformulated gasoline blendstock for February
delivery--the benchmark gasoline contract--rose 23 points to
$1.3190 a gallon, while February diesel traded at $1.6418, 20
points higher.
ICE gasoil for February delivery changed hands at $476.00 a
metric ton, up $0.75 from Monday's settlement.
--Liyan Qi contributed to this article.
Write to Eric Yep at eric.yep@wsj.com
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