"The whole market picture is still very weak, but sentiment
has been very bullish," said Clarence Chu, an energy trader at
Hudson Capital Energy in Singapore.
"I expect that if eventually we get up to $83.95, people
will take profit and get off their longs. I don't think the
market can go past that point."
The U.S. Energy Information Administration is expected to
hold its global oil demand growth forecast steady for this year
at 1.2 million barrels in its latest report, although some
analysts believe the EIA might be too optimistic given
stubbornly high oil prices and an uncertain economy.
[ID:nN08188405]
The EIA's monthly short-term supply and demand forecast
will be published on Tuesday at 1500 GMT.
U.S. crude inventories gained 1.9 million barrels in the
week to March 5, the poll showed, while gasoline stockpiles may
have increased by 300,000 barrels.
Distillates, a fuel category that includes heating oil and
diesel, were expected to have dropped 900,000 barrels because
of lingering winter weather conditions in the U.S. Northeast,
the biggest heating market.
The industry-funded American Petroleum Institute (API) will
publish inventory data on Tuesday at 2130 GMT, followed by
government statistics from the EIA on Wednesday at 1530 GMT.
RESISTANCE VS SUPPORT
Looking at price chart patterns, oil was unlikely to fall
below $80.50, Chu said. "It was a resistance for long, and
after we broke through it, it became a support level."
"But according to fundamentals we should look at $75 or
even $70 because we are losing jobs every month," Chu said.
"GDP is coming up, but it's not that healthy a recovery unless
jobs return."
The dollar, which for months has been inversely correlated
with oil prices, edged up on Tuesday against a basket of
currencies. [.DXY] But some traders said the currency has
recently influenced crude prices less, especially at times when
economic data releases enter the spotlight.
The euro rose slightly against the U.S. dollar on Monday as
concerns about Greece's indebtedness eased, while U.S. equities
ended little changed after last week's rally.
(Editing by Clarence Fernandez)