* U.S. crude settles down 2.5 pct; Brent off 1.4 pct
* Reuters poll forecasts 2.3 mln bbls U.S. crude build last
week
* Genscape reports over 1.5 mln barrels build in Cushing
alone
* Morgan Stanley (NYSE:MS) says oil's recent gains fueled by macro
factors
* Barclays (LON:BARC) unsure prices will rise or stay at current highs
(New throughout, adding market settlements and Reuters poll
forecasting third week of U.S. crude builds)
By Barani Krishnan
NEW YORK, April 25 (Reuters) - Oil prices fell more than 2
percent on Monday as data pointed to fresh U.S. crude builds,
while leading banks in commodities said the two-month long oil
market rebound has defied fundamentals.
A Reuters poll forecast a nationwide U.S. crude build of 2.3
million barrels last week, a third straight week of such builds.
EIA/S
Market intelligence firm Genscape reported that stockpiles
at the Cushing, Oklahoma delivery point alone rose by over 1.5
million barrels in the week to April 22, traders said.
Analysts at Morgan Stanley attributed oil's recent gains to
macro and commodity funds activity, index- and exchange-traded
fund flows and buying from investors fearful of missing out,
even as fundamentals remained bearish and looked set to worsen
as prices moved higher.
Barclays, in an oil sector report, said it was "not yet
convinced that prices will remain here or go even higher".
U.S. crude CLc1 settled down $1.09, or 2.5 percent, at
$42.64 a barrel. Last week, it hit a five-month high of $44.49.
Brent LCOc1 closed down 63 cents, or 1.4 percent, at
$44.48. It hit a mid-November high of $46.18 last week.
Trading was initially choppy, with prices building on gains
over the past three weeks before sliding on the Genscape report.
The dollar's .DXY slide after a three-day gain also limited
oil's downside in early trade as commodities denominated in the
greenback became attractive to users of the euro and other
currencies. FRX/
Oil traded above $100 a barrel in mid-2014 before hitting
12-year lows under $30 earlier this year on glut worries. But
since the end of February, crude prices have risen about 30
percent, responding to tighter U.S. production and OPEC plans
for an output freeze, which has, however, not materialized.
Some analysts say the rally could come to a crashing halt as
production of oil products, especially in Asia, remains rampant
and several major gasoline importing countries begin exporting.
"Still-elevated inventory levels, the return of some
disrupted supply, further boosts to Saudi and Iranian supply,
and increased non-OECD product exports all have the potential to
move prices lower over the next several months, especially if
broader macro sentiment shifts," analysts at Barclays wrote.
Market data shows the amount of open positions betting on
rising U.S. crude prices 1067651MLNG rose to June 2015 highs
last week. Bets taken out in expectation of falling prices
1067651MSHT fell close to 2016 lows.
While non-fundamental rallies can last several months, "a
macro unwind could cause severe selling given positioning and
the nature of the players in this rally", Morgan Stanley's
analysts said.