* Strong dollar, weak equities prompt late profit-taking
* Investors cautions ahead of EIA data on Thursday
* Brent up 3 percent for May, WTI up 7 percent
(New throughout, updates prices, market activity and comments
to settlement)
By Barani Krishnan
NEW YORK, May 31 (Reuters) - Oil prices dipped on Tuesday as
a stronger dollar and slide in equity prices sparked
profit-taking, but crude futures posted a fourth straight
monthly gain as investors bet that the global glut was slowly
easing.
Crude futures had gained early in the session, with
investors expecting higher U.S. fuel demand as peak driving
season arrived in the No. 1 oil consumer.
Caution ahead of weekly U.S. crude inventory data kept
investors from pushing prices toward seven-month highs above $50
a barrel. The dollar's rise and slide in Wall Street stocks in
afternoon trade eventually tipped oil into the negative zone.
Brent crude futures for July LCON6 settled down 7 cents at
$49.69 a barrel before expiring as the spot contract. August
Brent LCOQ6 , the market's spot contract from Wednesday,
finished down 47 cents, or nearly 1 percent, at $49.89.
U.S. crude's West Texas Intermediate (WTI) futures for July
CLc1 settled at $49.10, down 23 cents, or 0.5 percent, from
Friday's settlement. U.S. financial markets were closed on
Monday for the Memorial Day holiday.
For the month, Brent rose 3 percent and WTI gained 7
percent.
"The dollar's strength and the weakness in equities hit
crude on the day," said Chris Jarvis, analyst at Caprock Risk
Management in Frederick, Maryland. "Plus, $50 remains a
psychological target to cross, with caution playing ahead of the
EIA data."
The dollar .DXY gained as strong U.S. consumer spending
data fed expectations of a rate hike in coming months.
The U.S. Energy Information Administration (EIA), will issue
crude supply-demand data on Thursday. Oil prices last traded
above $50 on Thursday, when Brent last hit a November peak of
$50.51 and WTI an October high of $50.21.
Prices rose early in the session after traders said that
data from market intelligence firm Genscape showed a drawdown of
686,700 barrels at the Cushing, Oklahoma delivery point for WTI
futures in the week to May 27. A Reuters poll of analysts
forecast that U.S. crude stocks fell 2.7 million barrels last
week. EIA/S
U.S. fuel demand is set to rise with the summer driving
season that began with Monday's holiday. Hedge funds and other
money managers last week raised bullish bets on WTI to 2016
highs.
Investors do not expect the Organization of the Petroleum
Exporting Countries to make any substantial changes in
production at a meeting set for Thursday.
Some analysts believe oil prices can slowly meander higher.
"The bulk of our technical indicators remain tilted in a
bullish direction ... with upside possibilities to the
$52-52.50 areas still valid," said Jim Ritterbusch of
Chicago-based oil consultancy Ritterbusch & Associates.