(Adds API data and market reaction, paragraph 9)
By Robert Gibbons
NEW YORK, Oct 27 (Reuters) - Oil prices fell a third
straight session to multi-week lows on Tuesday on the persistent
global supply glut ahead of data expected to show another
increase in U.S. crude inventories.
Futures felt pressure from expectations that U.S. crude
inventories rose 3.4 million barrels last week, a fifth
consecutive build after gaining 22 million barrels in a
four-week span. EIA/S urn:newsml:reuters.com:*:nL1N12L19S
At 476.6 million, U.S. crude stocks on Oct. 16 were nearly
100 million barrels above the year-ago period, according to
Energy Information Administration (EIA) data.
Brent December futures LCOc1 fell 73 cents to settle at
$46.81 a barrel. The settlement and the $46.41 session low were
the lowest since Sept. 15.
U.S. December crude CLc1 fell 78 cents to settle at
$43.20, lowest settlement since Aug. 27. Tuesday's intraday low
of $42.58 was the weakest since Aug. 28.
Front-month November U.S. RBOB gasoline RBc1 and ultra-low
sulfur diesel (ULSD) HOc1 seesawed in volatile trading on the
day options expired. The November contracts expire on Friday.
"It's still the supply glut weighing on crude and the
products are going to be a bit volatile with options
expiration," said Phil Flynn, analyst at Price Futures Group in
Chicago.
While distillate inventories, which include diesel and jet
fuel, were expected have fallen last week, storage utilization
for distillates in the United States and Europe is nearing
historic highs, Goldman Sachs (N:GS) GS.N said on Monday.
urn:newsml:reuters.com:*:nL3N12Q256
Crude pared losses and ULSD futures turned higher in
post-settlement trading after industry group American Petroleum
Institute's data showed crude stocks rose 4.1 million barrels
last week, but fell at the Cushing, Oklahoma, hub, while
distillate inventories fell 2.6 million barrels. API/S
EIA data will be released on Wednesday.
U.S. crude oil production cuts - from a peak of around 9.6
million barrels per day to around 9.1 million - and optimism
over demand have failed to translate into higher prices, said
Ric Spooner, chief market analyst at Sydney's CMC Markets.
Investors awaited the outcomes of key policy talks this
week, including a U.S. Federal Reserve meeting and China's fifth
plenum, a meeting of the Communist Party's central committee.
"China's appetite for foreign crude oil has been impressive
this year, driven by an accelerated build-out of Strategic
Petroleum Reserve storage facilities, and the granting of crude
usage and import quotas for independent 'teapot' refineries,"
Citi said in a report.
But about 4 million barrels purchased by a Chinese state
trader for the reserve have been stranded off shore due to a
lack of storage, according to trade sources. ID:nL3N12Q3KJ
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Chart on Brent oil: http://graphics.thomsonreuters.com/US/2/PVB_20152710090518.png
Chart on U.S. oil: http://graphics.thomsonreuters.com/US/2/PVB_20152710085606.png
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