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LONDON Oil prices fell Wednesday, following on sharp declines at the start of the week and ahead of U.S. inventory data expected to show increased supplies.
Light sweet crude for December delivery fell 16 cents to $58.57 a barrel on the New York Mercantile Exchange. December Brent crude oil fell 2 cents to $59.01 on the ICE Futures exchange.
"The market has no real headlines to drive it, and the weather forecast for the Northern Hemisphere winter is on the warm side," which will keep prices around $57-$58 a barrel, said Victor Shum, an energy analyst at Purvin & Gertz in Singapore.
A sudden cold snap, however, would bump up fuel demand and prompt a price spike, he said.
"The sharp decline in oil prices seen at the start of the week came to a halt yesterday," PVM Oil Associates said Wednesday, though new U.S. inventory data to be published later Wednesday were expected to give further direction to the market.
A Dow Jones Newswires survey of analysts forecast crude stocks would rise 2.5 million barrels, while distillate inventories were expected to fall by 1.3 million barrels. The survey also forecast a 1.1 million barrel draw in gasoline stocks.
Heating oil futures fell less than half a cent to $1.6640 a gallon, while gasoline futures rose more than 2 cents to $1.4492 a gallon. Natural gas rose 3.6 cents to $7.570 per 1,000 cubic feet.
On Monday, crude-oil futures declined by more than $2 a barrel amid mild weather on the East Coast and an expectation that the U.S. government data scheduled to be released later Wednesday will show rising inventories of crude.
The expiration of November futures contracts for gasoline and heating oil on Tuesday also helped to drag prices lower, brokers said, as did doubts about OPEC's ability to implement its plan to cut 1.2 million barrels a day of production.
"Longer term, the oil market's next move is really going to depend on the winter season weather and the broader global economic outlook," Shum said.
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