Oil slips to $104 as U.S. crude supplies seen rising

An oil rig operating in Louisiana. Show caption
An oil rig operating in Louisiana.

The price of oil slipped closer to $104 a barrel Monday as investors weighed expectations of rising U.S. crude stockpiles against tensions in Ukraine.

By early afternoon in Europe, U.S. crude for May delivery was down 42 cents to $103.95 in electronic trading on the New York Mercantile Exchange. On Monday, the Nymex contract added 7 cents to close at $104.37.

Brent crude, an international benchmark for oil, was down 49 cents to $109.46 on the ICE Futures exchange in London.

U.S. crude supplies are seen having grown by 3.1 million barrels in the week ending April 18, with gasoline stocks falling by 1.7 million barrels, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

The American Petroleum Institute will release its report on oil stocks later Tuesday, while the report from the Energy Department’s Energy Information Administration — the market benchmark — will be out on Wednesday.

A week ago, the EIA reported an increase of 10 million barrels in crude supplies, the largest rise in 13 years.

At the same time, markets remain wary that possible new European or U.S. sanctions may disrupt Russian oil and gas exports. Pro-Russian insurgents in eastern Ukraine have occupied government buildings and set up checkpoints in demand of closer ties with Russia.

On Tuesday, U.S. Vice President Joe Biden was in Kiev, the capital of Ukraine, and called on Russia to work toward reducing tensions in the region.

In other energy futures trading in New York:

— Wholesale gasoline lost 1.13 cents to $3.0336 a gallon.

— Natural gas added 0.9 cent to $4.706 per 1,000 cubic feet.

— Heating oil fell 0.66 cent to $2.9976 a gallon.