NYMEX May crude settled $1.84 lower at $99.74/barrel Tuesday on expectations of another build in US crude stockpiles and bearish data from China and Europe.
ICE May Brent settled $2.14 lower at $105.62/b. The Brent-WTI spread settled at a six-month low of $5.88/b, down from $6.18/b on Monday.
In products, NYMEX May ULSD settled 4.2 cents lower at $2.8878/gal and May RBOB ended 4.82 cents lower at $2.8697/gal.
Chinese manufacturing data was bearish but also somewhat divergent, Gene McGillian, analyst at Tradition Energy, said, as the HSBC index slipped from 48.5 to 48, while the official government report showed both a slight increase and a reading above 50, indicating expansion.
In Europe, eurozone unemployment was 11.9% in February, according to EuroStats data, which was below market expectations of 12%. German unemployment continued to hold at the lowest rate in two decades, but Italian unemployment was at a record high of 13%.
In the US, crude stocks are expected to have fallen 1.8 million barrels for the reporting week ended Friday, according to a Platts survey of analysts.
"I think there's a reallocation of risk," said Carl Larry, president of Oil Outlooks, of the decline in crude futures. "With ... another expected build in crude inventories, money is looking for a safer and stronger investment."
Larry added that US equities were at new highs and "confidence in those markets is a lot stronger than $100 WTI right now."
Kyle Cooper, analyst at IAF Advisors, noted that a report that rebels in Libya could be close to reopening three ports in the eastern part of the country, which accounted for about 600,000 b/d of exports before being occupied last summer, weighed on the oil complex.
"Crude had shown strength above the $100/b level over the past few weeks but with no escalation of tensions between Russia and Ukraine and the report about Libya, the market lost support," Cooper said.
