Oil slides on U.S. refinery maintenance, OPEC meeting doubts

Thu Mar 10, 2016 4:10pm EST
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By Barani Krishnan

NEW YORK (Reuters) - Oil prices fell on Thursday, with U.S. crude retreating from three-month highs as refinery maintenance looked set to boost record domestic crude stockpiles, while an OPEC meeting aimed at freezing output appeared unlikely without Iran's participation.

Crude prices drew support as the dollar weakened versus the euro. Trading was also volatile toward settlement on buying by funds aiming to keep prices at or near $40 a barrel, market participants said.

Global oil benchmark Brent LCOc1 settled down $1.02, or 2.5 percent, at $40.05 a barrel, after hitting a session low at $39.63.

U.S. crude CLc1 fell 45 cents to finish at $37.84, having recovered from an intraday low of $37.21.

On Wednesday, oil rallied as much as 5 percent, with U.S. crude hitting three-month highs of $38.51 a barrel as a big gasoline inventory drawdown overshadowed record high crude stockpiles. [EIA/S]

On Thursday, some analysts said the gasoline draw, which was triple expectations, could be partly due to the market transitioning from winter-grade to summer-grade motor fuel. They also said the U.S. refinery maintenance season could push crude stockpiles even higher.

Some said that despite the big U.S. draw, there was ample gasoline on both sides of the Atlantic, which could undercut a sustained recovery in crude prices.

U.S. gasoline futures RBc1 fell 2 percent on Thursday, after a 6 percent rally the previous session.   Continued...

Pump jacks are seen at the Lukoil company owned Imilorskoye oil field, as the sun sets, outside the West Siberian city of Kogalym, Russia, January 25, 2016. REUTERS/Sergei Karpukhin