Oil down in Asia ahead of US inventory report

In this file photo taken with a long exposure, a pumping unit sucks oil from the ground near Greensburg, Kan. AP FLE PHOTO

SINGAPORE – Oil was down in Asia on Wednesday as caution set into the market ahead of a US crude inventory report, analysts said.

New York’s main contract, light sweet crude for delivery in May dropped 24 cents to $93.96 a barrel and Brent North Sea crude for May delivery shed 12 cents to $106.11.

“Cautious dealers are repositioning themselves for the US inventory report after a rally in prices,” Ric Spooner, chief market analyst at CMC Markets in Sydney, told Agence France-Presse.

“The market has a ‘wait-and-see’ attitude in the meantime.”

Analysts expect the US Department of Energy’s weekly petroleum stockpiles report to show another increase in supplies which would mirror weaker demand in the world’s biggest economy and put downward pressure on prices.

Prices had risen at the start of the week driven by strong Japanese equities, a subdued inflation report from China and a weaker dollar.

The Chinese government on Tuesday said the country’s consumer price index rose 2.1 percent in in March, well below the 10-month-high of 3.2 percent in February and below the 2.4 percent CPI reading forecast by analysts.

The slowdown in inflation eased investor concerns that China — the world’s biggest energy consumer — would want to tighten monetary policy.