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Oil prices little changed as dollar gains, U.S. drawdown seen

Published 24/05/2016, 10:34 am
© Reuters.  Oil prices little changed as dollar gains, U.S. drawdown seen
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By Keith Wallis

SINGAPORE, May 24 (Reuters) - Oil prices were little changed in thin early Asian trade on Tuesday as a firmer dollar weighed on oil markets while a likely drawdown in U.S. crude and gasoline stockpiles pointed to stronger demand ahead of the U.S. summer driving season.

U.S. crude futures CLc1 edged down 4 cents to $48.04 a barrel by 0016 GMT, having settled down 33 cents in the previous session.

Brent futures LCOc1 dipped 4 cents to $48.31 after closing down 37 cents in the previous session, with both contracts finishing with modest losses for a fourth straight session

U.S. commercial crude oil stocks likely fell by around 2.5 million barrels to 538.8 million in the week ended May 20, a preliminary Reuters analysts' poll taken ahead of weekly industry and official inventory data showed on Monday. stocks likely fell 1.3 million barrels last week, while distillate inventories, which include heating oil and diesel fuel, likely decreased by a million barrels, the poll showed.

The American Petroleum Institute (API) is due to release its inventory data later on Tuesday, while the U.S. Department of Energy's Energy Information Administration (EIA) is due on Wednesday.

The dollar index .DXY rose marginally higher against a basket of currencies on Tuesday, as investors continued to factor in an increased chance of a near-term U.S. interest rate rise.

A stronger greenback makes dollar-priced commodities more expensive for holders of other currencies.

Still, U.S. data economic overnight was disappointing, with the preliminary Markit manufacturing PMI in May falling to 50.5, the lowest level this year.

"Markit PMI data continued to point to a difficult period for manufacturing as Q2 unfolds," ANZ said in a market report on Tuesday.

Crude exports from Iraq's southern oil fields have fallen by more than 200,000 barrels per day (bpd) to around 3.15 million barrels so far in May, according to an industry source and loading data. That followed the previous month's near-record of 3.36 million bpd. crude production has risen above 300,000 barrels per day (bpd) after the reopening of the Marsa al Hariga export terminal in the east of the country late last week, a spokesman for the Tripoli-based National Oil Corporation (NOC) said on Monday.

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