By Sara Sjolin and Michael Kitchen, MarketWatch
LONDON (MarketWatch) ? Oil futures slipped on Monday, on track to break a six-day winning streak, which had helped push the September contract to a two-week high last week on continued unrest in Egypt.
Crude oil for September delivery /quotes/zigman/2291784 CLU3 -0.51% ?dropped 30 cents, or 0.3%, to $107.16, falling from its $107.46 settlement Friday on the New York Mercantile Exchange.
October Brent crude /quotes/zigman/2735838 UK:LCOV3 +0.04% ?improved by 24 cents, or 0.2%, to $110.64 a barrel, helped higher as analysts at Goldman Sachs lifted the 3-month forecast for Brent to $110 a barrel from the $105 a barrel expected previously. For the very short term, the bank said it sees Brent around $115.
Oil prices remain vulnerable to bearish news, say some analysts.Both Nymex and Brent futures saw gains last week as Egypt ? where the Suez Canal and Suez-Mediterranean pipeline serve as key transit points for Mideast oil ? saw deadly clashes between the army and supporters of ousted President Mohammed Morsi. At least 36 supporters of Morsi were killed after being arrested by Egyptian authorities, media reports said.
On Sunday, the Egyptian interim government held an emergency meeting as army chief Gen. Abdel Fattah al-Sisi vowed to continue ?securing the state,? with more protests expected from Morsi?s supporters.
Other supply-related issues also helped oil over the past week, including strikes at Libyan facilities and maintenance in the North Sea fields that produce Brent crude.
But energy analysts at Citi Futures said late Friday that prices could easily head in the other direction, with a large number of long positions likely to unwind if news events point to a recovery to supply or a threat to demand.
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?Increasingly, the market needs an ongoing diet of bullish news and upside price movement to keep them happy in the trade. And at the same time, the market also becomes increasingly vulnerable to bearish developments,? they said in a note to clients.
Among the possible triggers for a large unwinding of long positions, they said, were a resolution to Libyan strikes, a recovery in European production after North Sea oil-field maintenance, the seasonal decline in U.S. refinery runs, and any development that sparks a wider ?risk-off? trade, such as the tapering of Federal Reserve stimulus or a U.S. debt-ceiling fight.
Most other energy-futures trade saw soft movements, with September gasoline /quotes/zigman/2234285 RBU3 +0.33% ?up 1 cent at $2.98 a gallon, and September heating oil /quotes/zigman/9821420 HOU3 +0.13% ?also up a penny at $3.10 a gallon.
However, September natural gas /quotes/zigman/2294287 NGU13 +2.32% ?rallied 8 cents, or 2.4%, to $3.45 per million British thermal units, erasing its 5-cent loss on Friday amid pre-weekend short-covering.
/quotes/zigman/2291784
US : U.S.: Nymex
Volume: 13,663
Aug. 19, 2013 8:21a
/quotes/zigman/2735838 UK : U.K. ICE Futures Europe
Volume: 53,193
Aug. 19, 2013 1:20p
/quotes/zigman/2234285 US : U.S.: Nymex
Volume: 2,573
Aug. 19, 2013 8:20a
/quotes/zigman/9821420 US : U.S.: Nymex
Volume: 3,622
Aug. 19, 2013 8:21a
/quotes/zigman/2294287 US : U.S.: Nymex
Volume: 12,531
Aug. 19, 2013 8:21a
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin. Michael Kitchen is Asia editor for MarketWatch and is based in Los Angeles. You can follow him on Twitter at @KitchenNews.
Source: http://www.marketwatch.com/news/story.asp?guid=%7B468435C4-0876-11E3-A54E-002128040CF6%7D&siteid=rss
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