WTI Crude Fluctuates Before U.S. Industrial Output Data

Brent crude rebounded from its lowest settlement in more than two months before the U.S. Federal Reserve meets to review the pace of its stimulus measures for the world’s largest economy.

The North Sea grade advanced as much as 1 percent after closing on Oct. 25 at its lowest since Aug. 8. The Federal Open Market Committee, starting a two-day meeting tomorrow, is likely to delay reducing, or “tapering,” monthly bond purchases until March, according to a Bloomberg News survey of economists. Crude production in Libya, holder of Africa’s largest reserves, dropped to about 250,000 barrels a day after labor protests, according to the state-run National Oil Corp.

“The delayed tapering is supporting oil prices” by boosting investor appetite for riskier assets, said Michael Poulsen, an analyst at Global Risk Management in Middelfart, Denmark. The prospect of continued bond purchases is weakening the dollar, making assets such as crude that are priced in the U.S. currency more attractive, Poulsen said.

Brent for December settlement gained as much as $1.05 to $107.98 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $9.72 to West Texas Intermediate futures, up from $9.08 on Oct. 25. The volume of all Brent futures traded was within 1 percent of the 100-day average.

WTI for December delivery was at $97.74 a barrel in electronic trading on the New York Mercantile Exchange, down 11 cents at 11:53 a.m. London time. Last week it lost 2.9 percent, the most in five weeks.

Factory Output

A series of U.S. government data is due this week, including figures that will show manufacturing output rose in September, according to a Bloomberg survey. U.S. industrial production advanced 0.4 percent in September, the same as in the prior month, according to the median of 78 estimates. Manufacturing probably gained by 0.3 percent, compared with 0.7 percent in August, economists estimated.

Production at Libya’s Sharara oil field fell almost 50 percent from approximately 300,000 barrels a day because of a stoppage yesterday, Mohamed Elharari, a spokesman for the state-run National Oil Corp., said by telephone from Tripoli.

OPEC Policy

OPEC, which provides about 40 percent of the world’s oil, is focused on keeping supplies adequate, Suhail Mohammed Al Mazrouei, energy minister for the United Arab Emirates, said today in Singapore. Comments about the group’s likely decision when it meets to review output would be “premature,” he said. The U.A.E. is the fourth-biggest producer in the Organization of Petroleum Exporting Countries, which meets in Vienna on Dec. 4.

“The decision is always going to be to ensure that the market is well-supplied,” Al Mazrouei said during Singapore International Energy Week. “We have no benefit in over-supplying or under-supplying the market.”

Iraq’s crude exports last month dropped to 62.1 million barrels amid maintenance work, according to an oil ministry spokesman. Shipments from the southern terminal of Basra were 54.6 million barrels in September, while exports from Kirkuk in the north reached 7.5 million barrels, Asim Jihad, a spokesman for the oil ministry, said in an e-mail yesterday.

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