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Brent crude was down 55 cents, or 0.6%, at $85.44 a barrel by
0922 GMT. U.S. oil dropped 56 cents, or 0.7%, to $83.20.
"There was no specific reason for the price slide... The fact
that the market remains tight should drive prices up," said
Commerzbank analyst Carsten Fritsch.
Goldman Sachs said Brent was likely to push above its year-end
forecast of $90 a barrel, while Larry Fink, chief executive of
the world's largest asset manager BlackRock, said there was a
high probability of oil reaching $100.
While China's red-hot power and coal markets have cooled
somewhat after government intervention, energy prices remain
elevated worldwide as temperatures fall with the onset of the
northern winter.
"Forecasts for a colder November have energy traders bracing for
a very tight market that will be met (with) unprecedented demand
this winter," OANDA senior market analysts Edward Moya said in a
note.
"This oil market will remain tight and that should mean a
headline or two away from $90 oil."
Gasoline and distillate consumption in the United States is back
in line with five-year averages after more than a year of
depressed demand, and the market will be closely watching U.S.
inventory levels.
Crude oil stockpiles are forecast to have risen by 1.7 million
barrels last week while gasoline and distillate inventories were
expected to have fallen, according to a Reuters poll of
analysts. [EIA/S]
Avtar Sandu, senior manager, commodities at Phillip Futures in
Singapore, said traders were also awaiting clarity on the
outcome of international talks on reviving Iran's 2015 nuclear
agreement, after the United States said efforts were at "crucial
phase" that could re-open the way for exports of Iranian crude.
(Reporting by Aaron Sheldrick; Editing by Robert Birsel and John
Stonestreet)
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