Oil stays lower

Oil futures fell for a second straight session on Tuesday, weighed down by concerns about sputtering economic growth and indications that Opec's top producer Saudi Arabia is working to drive down prices. Crude futures extended the previous session's slide as investor focus shifted from the likely economic benefit of additional stimulus to the economic problems that prompted the US Federal Reserve to launch its bond-buying programme.
A senior Gulf source said Saudi Arabia is working to lower oil prices and is producing around 10 million barrels per day, putting additional pressure on oil prices. The source also said most members of the Organisation of the Petroleum Exporting Countries want oil prices around $100 per barrel and would boost production over the next few months. "Unless there is a major supply disruption in the Middle East, there is nothing to push it higher," said analyst Andrey Kryuchenkov at VTB Capital. "Saudi will seek to drive it closer to $100 and everyone knows it."
Brent prices rose seven straight sessions before settling 2.4 percent lower on Monday, benefiting first from growing expectations that the Fed would act to bolster the economy, and subsequently from the actual launch of the stimulus programme on Thursday after a two-day policy meeting.
Brent November crude fell $1.76 to settle at $112.03 a barrel, having dropped as low as $111.62, below the 200-day moving average of $111.87, a technical level tracked by traders. US October crude fell $1.33 to settle at $95.29 a barrel, below the 200-day moving average of $96.57. Tuesday's trading range was from $95.15 to $97.23. The October contract expires on Thursday.
US November crude fell $1.33 to settle at $95.62. US total crude trading volumes were tepid, lagging the 30-day average by 4 percent. Brent turnover outpaced US crude and surpassed Brent's 30-day average by 19 percent. US RBOB gasoline and heating oil futures dropped another 1 percent on Tuesday, after they matched crude futures' 2.4 percent drop on Monday. Gasoline slumped 4.43 cents to settle at $2.8990 a gallon, leaving it well below the 200-day moving average of $2.9452 and in sight of the 100-day moving average of $2.8870.
US retail gasoline demand in the two weeks to September 14 fell 1 percent from a year earlier as prices kept rising, according to a report from MasterCard. Monday's steep, rapid intraday sell-off left Brent down more than $5 at the day's low and US crude off more than $4.
The sell-off came after Brent and US crude did not extend the previous week's surge on the Fed stimulus that sent prices to four-month highs. Traders explained the plunge variously as stemming from computer-based trading, sell stops triggered in a session characterised by light trading volume on the Rosh Hashana holiday and from heightened expectations that the United States and its allied consumer nations would release oil reserves. The White House on Tuesday again said the United States was monitoring the situation and that all options remain on the table, including a release of strategic oil reserves.