Oil was steady under $49 on Wednesday, after weak US economic data sparked a bout of profit-taking overnight, outweighing escalating tensions in the Middle East and widening supply cuts from the Russian gas row. The market will be watching for weekly inventory data from the US energy department due later on Wednesday, which are forecast to show a jump in stockpiles, and US December employment data, to be released on Friday.
"The EIA weekly inventory numbers and the US unemployment data will be key for near-term price direction," said Jim Ritterbusch, president of Ritterbusch & Associates. "If we see any surprises from the EIA stats, it's likely to be bearish rather than bullish." US crude for February delivery was up 6 cents a barrel at $48.64 by 0300 GMT, while London Brent was up 7 cents at $50.60.
Data released on Tuesday showed that pending sales of US homes dropped in November to their lowest level in at least seven years and that the country's services sector shrank for the third consecutive month in December. A report from the US Energy Information Administration due later is likely to show fuel stocks rising as demand slows, with crude oil inventories seen up 900,000 barrels last week, and distillates and gasoline supplies also expected to have increased.