Oil lower as offshore damage from Isaac seen limited

Wed Aug 29, 2012 3:42pm EDT
 

By Robert Gibbons

NEW YORK (Reuters) - Brent crude prices edged lower in choppy trading on Wednesday, while U.S. oil futures fell on expectations that damage to oil facilities from Hurricane Isaac will be limited and in reaction to data showing a sharp rise in U.S. crude oil stocks.

Brent crude losses were tempered by upcoming North Sea maintenance, the ongoing turmoil in the Middle East and the possibility of a strike by Norwegian oil service sector workers.

Technical support was a factor, with Brent's pull back stalling 2 cents above its 200-day moving average of $111.48 a barrel, traders said.

Hurricane Isaac drove water over the top of a levee on the outskirts of New Orleans, but the multibillion-dollar barriers built to protect the city itself after the 2005 Katrina disaster were not breached, officials said.

"It is expected that oil production in the Gulf of Mexico will quickly return to normal," said Carsten Fritsch, an oil analyst at Commerzbank in Frankfurt.

Isaac was downgraded to a tropical storm by the U.S. National Hurricane Center after crude prices settled.

Brent October crude eased 4 cents to settle at $112.54 a barrel, having swung from $111.50 to $113.30 during the session.

U.S. October crude settled down 84 cents at $95.49 a barrel. Its $96.37 session peak fell short of the 200-day moving average of $96.72.   Continued...