* Oil flow on Kirkuk-Ceyhan pipeline resumes -sources
* OPEC, before meeting, sees higher oil demand for 2013
* Wall Street ends at a record, posts third week of gains
* Coming Up: China Industrial output; 0530 GMT
By Manash Goswami
SINGAPORE, May 13 (Reuters) – Brent futures slipped towards $103 a barrel on Monday as the dollar stayed firm, with renewed worries of a slowdown in demand growth from the world’s top oil consumer the United States further weighing on sentiment.
The U.S. economy is expected to grow at a slower pace in the second and third quarters of this year, according to the Philadelphia Federal Reserve’s quarterly survey of 42 forecasters, compared with their previous estimates. Additional pressure for risk assets such as oil came from a broad rally in the dollar following strong data on the U.S. labour market.
Brent crude slipped 77 cents to $103.14 a barrel by 0143 GMT. It settled down 56 cents on Friday and ended the week lower after gains in the previous two.
U.S. oil fell 85 cents to $95.19, sliding the fourth time out of the past five sessions.
“A strength in the dollar is weighing on commodities across the board,” said Ben Le Brun, analyst at OptionsXpress in Sydney. “For oil, worries of ample supplies is putting pressure. We have unprecedented levels of stockpiles in the United States, with uncertainty surrounding economic growth.”
A firm dollar pressures oil as its strength makes commodities more expensive for holders of other currencies. The dollar rose to a fresh 4-1/2-year peak against the yen on speculation the Federal Reserve could scale back its aggressive monetary stimulus aimed at supporting growth.
The Organization of the Petroleum Exporting Countries in a monthly report on Friday forecast 2013 demand for its crude will average 29.84 million barrels per day (bpd), up 90,000 bpd from a previous estimate. Both world oil demand and demand for OPEC crude will increase in coming months, it said.
OPEC’s next meeting to consider its output comes on May 31.
U.S. ECONOMY
While there are signs of labour market resilience, despite deep government budget cuts, the rest of the U.S. economy is showing some strain.
Analysts expect the U.S. economy to grow at an annual rate of 1.8 percent in the current quarter, down from a previous estimate of 2.3 percent, according to the Philadelphia Fed’s survey. Third quarter growth expectations were cut to 2.3 percent from 2.6 percent in the previous survey; full year growth was seen at 2 percent.
U.S. retail sales are expected to have declined for a second straight month in April, mainly reflecting weak demand for automobiles.
Investors are also awaiting data on industrial production from the world’s second-biggest oil consumer China due later in the day. China’s factory output is expected to have grown 9.5 percent in April from a year ago, recovering slightly from a seven-month low hit in March.
“Oil will definitely take its cue from the China data due later,” Le Brun said. “It will be a crucial piece of data to gauge how the domestic economy is doing.”
Brent is expected to revisit its May 10 low of $101.56, as a downtrend from the May 7 high of $105.94 has not finished, while U.S. oil is expected to retest support at $93.58, according to Reuters technical analyst Wang Tao. (Editing by Tom Hogue)
Source: Reuters
