London: Oil failed to find momentum in either direction for a clear move away from $81.50 on Wednesday as investors waited for data on US stocks or Opec’s monthly report ahead of next week’s meeting to provide impetus.
US crude for April delivery was flat at $81.49 by 3:58pm. It had earlier risen to within 80 cents of Monday’s peak of $82.41, the highest level since prices jumped to a 15-month high of $83.95 on 11 January. London ICE Brent for April edged up 7 cents to $79.98.
“There’s a little bit of reticence about striking out one way or the other ... there’s not enough information to herald decisively a bull run,” said Paul Harris, head of energy and emissions at Bank of Ireland.
Crude prices need a fundamental kick to score direction.
“Technically, there are still no clear trends on WTI,” said Olivier Jakob at Petromatrix in a note.
“WTI is maintained ... close enough to $82 per barrel for the bulls to try another attack at that resistance level upon the delivery of the (US) statistics as there will necessarily be one positive item in the weekly report,” he added.
US inventory statistics from the government’s Energy Information Administration (EIA) will be published at 9:00pm.
The American Petroleum Institute’s figures, published on Tuesday, showed US crude inventories rose by 6.5 million barrels in the week to 5 March, against analysts’ forecasts for a gain of 1.9 million barrels.
But Jakob said the crude stock build could be an alignment with the energy department figures.
More indications on global supply and demand should come from Opec’s March report expected later on Wednesday.
Further support for prices came from China, where oil imports data boosted evidence emerging that Asian economies will lead global demand back into growth this year.
China imported 4.83 million barrels of crude per day in February, the second-highest daily tally on record. Fuel imports rose almost 14%, while fuel exports tumbled almost 41%.
“It’s a strong reading, particularly because February was a short month and you had the Chinese New Year holiday,” said David Moore, commodities strategist at the Commonwealth Bank of Australia in Sydney.
Harris said he thought the impetus would be for gains.
“We’re on an upward trajectory, however gentle the slope is ... there seems to be a groundswell of popular support for the notion that the US is past its worse and that China is pointing in a positive direction,” he said.
Opec members, who meet next week in Vienna to discuss supplies, have suggested prices around $70-80 are reasonable and on Monday Algeria said levels in the low $80s were fair.
The group’s biggest producer, Saudi Arabia, will reduce crude supply in April to a major Asian buyer, but will keep full contracted volumes to others.
The cut by the world’s leading oil exporter surprised industry players, who could not immediately explain it. It could be due to refinery maintenance, for example.
For March, top Chinese refineries will cut crude runs by 5.6% from record rates in February due to turnarounds and to lower bulging stocks.