Crude Oil Ends Lower On Demand Concerns, Ahead Of Supply Data

(RTTNews) - U.S. crude oil snapped a two-day gain to end lower on Monday, ahead of the weekly inventory data following some soft demand amid speculation of excess supply globally, even as markets look to steady after a volatile week brought on by concerns over the global economy.

According to reports, environmental concerns have forced Saudi Arabia and Kuwait to halt crude production in an oil field jointly run by them.

Nonetheless, analysts point to a potential oversupply from the Middle East, where the Saudis are reportedly content to let oil slide below $80 in order to counter competitors.

Last week, some non-Gulf OPEC nations urged the cartel consider cutting oil production to halt the slide in prices, even as Saudi Arabia opposed any such move by the group.

The weekly official inventory report from the U.S. Energy Information Administration is due Wednesday, while the American Petroleum Institute supply data is due late Tuesday.

Light Sweet Crude Oil futures for December delivery, the most actively traded contract, shed $0.15 or 0.2 percent to close at $81.91 a barrel on the New York Mercantile Exchange Monday.

Crude prices for December delivery scaled a high of $82.73 a barrel intraday and a low of $80.78.

Light Sweet Crude Oil futures for November delivery dipped $0.04 to close at $82.71 a barrel on the New York Mercantile Exchange Monday.

Crude prices for November delivery scaled a high of $83.48 a barrel intraday and a low of $81.55.

On Friday, crude oil futures ended up $0.05 at $82.75 a barrel, after scaling a high of $84.45 a barrel intraday. Earlier in the week, crude had plunged to $79.78 a barrel, its lowest level since June 2012.

Positive U.S. economic data, including reports showing a rise in industrial production, a notable drop in jobless claims and a more than expected improvement in consumer sentiment helped pull crude oil prices from lower levels.

However, continued worries about excess supply in the market following the weekly U.S. Energy Information Administration's report showing a huge surge in crude inventories limited oil's upside.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 85.00 on Monday, down from its previous close of 85.31 late Friday in North American trade. The dollar scaled a high of 85.38 intraday and a low of 84.95.

The euro trended higher against the dollar at $1.2804 on Monday, as compared to its previous close of $1.2750 late Friday in North American trade. The euro scaled a high of $1.2806 intraday and a low of $1.2732.

In economic news from eurozone, the eurozone current account surplus declined in August with surplus on trade in services declining notably, data from the European Central Bank showed Monday. The current account surplus dropped to a seasonally adjusted EUR 18.9 billion in August from EUR 21.6 billion in July.

Meanwhile, Germany's producer prices declined at a faster rate as expected in September, data from Destatis showed Monday. Producer prices fell 1 percent year-over-year in September following the 0.8 percent decrease in August, in line with the consensus estimate.

The Bundesbank in a downbeat view of the German economy, a monthly report from the central bank said the economic outlook should be either at the same level of the second quarter or slightly better than the prior quarter. The economy had contracted 0.2 percent in the second quarter.

Elsewhere in Europe, U.K. gross mortgage lending decreased slightly in August from last month, data from the Council of Mortgage Lenders showed Monday. Gross mortgage lending totaled GBP 17.8 billion, down 1 percent from August, but grew 10 percent from last September. In the third quarter, gross mortgage lending was estimated at GBP 55.5 billion, which represents an 8 percent increase from the second quarter.

Among key data due this week are reports on U.S. existing and new homes sales for September and initial jobless claims for last week. Also due this week are the house price index for August and the flash estimate of Markit's U.S. manufacturing survey for October.