Oil prices slip before US energy report

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World oil prices dipped on Wednesday as traders awaited the latest official snapshot of crude inventories in key consuming nation the United States.

New York's main futures contract, light sweet crude for delivery in July, shed 56 cents to 76.38 dollars a barrel.

Brent North Sea crude for August delivery slipped 18 cents to 76.92 dollars.

Prices rallied on Tuesday, along with stock markets and the euro, as investors grew more confident about the global economic recovery.

At 1430 GMT on Wednesday, the US government's Department of Energy will publish its report on American oil stockpiles for the week ending June 11.

"Today we are turning our attention back to US fuel inventories," said VTB Capital analyst Andrey Kryuchenkov.

Crude reserves are forecast to drop by 1.3 million barrels, according to analysts quizzed by Dow Jones Newswires. Gasoline or petrol inventories are predicted to be little changed.

US stockpiles of distillates, which include diesel and heating fuel, are expected to climb by 800,000 barrels.

"US refinery utilisation rates are likely to remain around 89 percent, helping another potentially significant pronounced decline in US crude inventories," Kryuchenkov said.

"We expect a draw of more than one million barrels in US crude stockpiles, also due to lower imports."

The DoE report is a key weekly event for traders because the United States is the world's biggest consumer of oil, followed by number two China.

The oil market was firmer in Asian trading hours earlier on Wednesday, drawing support from investors' positive outlook on the world economy.

So far this week, oil has benefited from a weaker dollar, which tends to boost demand for dollar-priced commodities as they become cheaper for buyers holding stronger currencies.

© 2010 AFP

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