0230 GMT: Crude oil futures were lower in mid-morning trade in Asia Oct. 13 as investors awaited the release of weekly US stocks data for fresh pricing cues.
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At 10:30 am Singapore time (0230 GMT), the ICE December Brent futures contract was down 61 cents/b (0.73%) from the previous close at $82.81/b, while the NYMEX November light sweet crude contract was 58 cents/b (0.72%) lower at $80.06/b.
"Crude's rally on the back of gas and coal shortages has lost steam. The bullish narrative that the energy crisis may get worse as the winter demand bites is intact," Vanda Insights CEO Vandana Hari told S&P Global Platts Oct. 13, adding that the conditions for high intraday volatility remain in place.
The pause in the recent sustained rally could prompt profit taking, but that may also prompt buying on the dips by market participants anticipating more upside to emerge in the coming week.
Investors are awaiting the release of weekly US stocks data by the American Petroleum Institute later Oct. 13 and more definitive numbers by the US Energy Information Administration the following day for fresh pricing cues.
Analysts polled Oct. 11 by S&P Global Platts were expecting the data to show a 500,000-barrel draw in US crude stocks to 420.4 million barrels for the week ended Oct. 8, which would run counter to seasonal trends; US inventories typically build as refinery runs slow with the onset of shoulder season maintenance.
ANZ research analysts in a note said that crude oil prices have ebbed and flowed as investors debate the impact of energy shortages in Asia and Europe, but there were growing expectations that high prices for gas and thermal coal were likely to boost demand for alternatives such as diesel and fuel oil.
Supply outlooks also remain constrained by the high gas and coal prices that raise the prospect of more switching to oil for power generation.
ANZ analysts referenced TotalEnergies CEO Patrick Pouyanné as saying that demand for fuel oil was soaring in parts of Asia as buyers turn away from gas, and also the IMF cautioning that threats to growth have increased amid rising costs for food and fuel.