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Oil prices swung between gains and losses and remained fairly unchanged through the early European session. Investors await the Energy Information Administrations weekly U.S. crude oil inventories report, which is poised to show a drop in reserves to the lowest level since January. Meanwhile, prices remained pressured as concern over supply continued to ease as Irans newly elected President Hassan Rouhani said during his first press conference he is determined to resolve the dispute with the U.S. over Irans nuclear program.

On the New York Mercantile Exchange, WTI crude for September delivery traded at $105.35 per barrel at 7:13 GMT, up 0.03% on the day. Prices ranged between days high and low of $105.81 and $105.12 per barrel respectively. Light, sweet crude settled 0.85% lower on Tuesday, a fourth consecutive daily decline, extending current weeks fall to over 1.4%.

Meanwhile on the ICE, Brent oil for delivery in September fell to $108.02 a barrel at 7:14 GMT, down 0.15% on the day. Prices shifted between days high and low of $108.28 and $107.75 a barrel respectively. Futures slipped 0.46% on Tuesday, also a fourth straight daily decline, bringing current weeks fall to 0.8%.

Oil prices kept falling on Wednesday despite the American Petroleum Institutes positive data as the previously built premium over supply concern from the Middle East continued to erode. Yesterday, the newly elected Iranian President Hassan Rouhani said at his first news conference since stepping into position that he was “seriously determined” to resolve the dispute over Irans nuclear program and was ready to start negotiations.

Ric Spooner, chief market analyst at CMC Markets, said for Reuters: “Such statements are usually for posturing and do not have any real impact at the end of the day. But we have had a change of guard, and people are in a wait-and-see mode to see what comes out of it.”

Prices also fell amid news that exports from the Buzzard oilfield in the North Sea are being resumed, after being down for maintenance.

Support

Meanwhile, losses remained limited as investors looked ahead at a bullish U.S. crude reserves report and expectations for upbeat China data. The Asian country was the second top oil consumer in 2012 and accounted for 11% of global consumption. Analysts expect Chinese exports, retail sales and factory output to have advanced in July, signaling an initial stabilization of the countrys economic activity. According to a Bloomberg survey, Chinas exports should have climbed 2% in July, compared to a 3.1% decrease in June. Imports might have risen 1% after falling 0.7% in the previous month.

Meanwhile, the industry-funded American Petroleum Institute reported yesterday that U.S. crude oil inventories fell by 3.7 million barrels in the week ending August 2. Gasoline inventories decreased by 1 million barrels, while distillate fuel supplies gained 1.5 million. However, APIs report is considered as less reliable than EIAs data since it is based on voluntary information from operators of refineries, pipelines and bulk terminals.

The Energy Information Administrations weekly oil statistics will be published on Wednesday at 14:30 GMT. According to a Bloomberg survey, numbers are likely to show U.S. crude reserves have dropped by 1.5 million barrels to 363.1 million, the lowest level since January. Gasoline inventories are expected to have declined by 500 000 barrels, while distillate fuel stockpiles should have remained unchanged at 126 million barrels.

“There is upcoming data from the United States and China that will give the market a sense of the demand outlook for oil,” Ric Spooner said for Reuters. “But the short-term outlook on oil prices looks to be on the downside.”

Oil also drew some support as a series of car bombs killed at least 51 people and injured more than 100 on shopping streets and markets in Baghdad on Tuesday. Meanwhile, at least nine Yemeni soldiers were killed also on Tuesday as tribesmen shot down a military helicopter in central Yemen where oil pipelines were repeatedly blown up during the past days.

Any news of further easing of concern over supply disruptions in North Africa and the Middle East will push oil prices lower. Market players are awaiting upcoming China data the remaining U.S. data for this week to further gauge global demand prospects and the recovery pace of the world’s top economy. On Wednesday, U.S. Consumer Credit indicator will likely show a decline to $15 billion in June, down from May’s $19.615 billion. Thursday’s Initial Jobless Claims are expected to have risen by 9 000 to 335 000 in the week ending August 3.

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