COLUMN-Hedge funds rotate from U.S. heating oil to gasoline: Kemp
LONDON, Sept 26 Hedge funds have become increasingly bullish about the outlook for gasoline prices even as they have become more cautious the prospects for heating oil this winter.
* East Libya group to negotiate with government on oil ports
* Upbeat U.S. data raises prospect of Fed stimulus wind-down
* Iran, Russia say U.S. steps violate spirit of nuclear deal (Releads, updates prices to settlement, adds CFTC data)
By Robert Gibbons
NEW YORK, Dec 13 U.S. crude futures fell on Friday on expectations the Federal Reserve could announce a pullback of its bond-buying program as early as next week.
The Fed stimulus, or quantitative easing, has supported riskier assets such as commodities and equities.
Brent crude edged higher, in seesaw trading ahead of the January futures contract expiration on Monday, on support from uncertainty about whether oil ports in eastern Libya will resume exports.
"We've had the Fed potentially talking about the tightening of monetary policy, so that's going to bring us down a bit," said Phil Flynn, an analyst at the Price Futures Group in Chicago, Illinois.
"After the failure to follow through and break above $99 [per barrel], people are realizing 'Hey, there's a lot of supply here in the market'," he added.
U.S. crude futures for January delivery fell 90 cents to settle at $96.60 a barrel, posting a 1 percent loss on the week. At this week's high of $98.75 reached on Wednesday, U.S. futures prices had gained $5 since the beginning of December.
Upbeat economic data from the United States on Thursday heightened speculation among commodity and equities investors that the Fed, which holds a two-day policy meeting next week, may be ready to start trimming its monthly bond purchases.
While Energy Information Administration (EIA) data released on Wednesday showed crude oil inventories fell 10.6 million barrels last week, U.S. stockpiles totalled 375.2 million barrels, up 2.6 million barrels from the year-ago period.
Brent January crude on Friday rose 16 cents to settle at $108.83 a barrel, after losing more than $1 on Thursday. Brent posted a weekly loss of 2.5 percent.
"Brent is getting support from creeping doubts about the return of those Libyan barrels," said John Kilduff, partner at Again Capital LLC in New York.
After indicating earlier this week it would end a seizure of three eastern ports, a group seeking autonomy for East Libya said on Friday it would negotiate with government officials on Saturday, but added that if its demands for a greater share of the oil wealth are not met by Sunday, the group would try to sell crude on its own.
Libya's government said on Wednesday it expects eastern tribes to reopen three oil ports this weekend, which could increase the OPEC producer's shipments from the current 110,000 barrels per day.
Internal conflicts threatening its oil industry have fueled doubts as to whether Libya can raise its output significantly.
Brent crude also was supported by supply concerns arising from violence in Iraq's oil and natural gas fields and Thursday's car-bomb attack near the Suez Canal, a major transportation channel for global oil supply.
Traders kept an eye on diplomatic developments between major powers and Iran. A lifting of sanctions on the OPEC producer's oil exports would increase global supply.
Russia said on Friday that a new U.S. measure targeting companies and individuals for supporting Iran's nuclear program violated the spirit of the nuclear deal Iran reached with major powers last month.
Brent's premium to U.S. crude CL-LCO1=R, also known by its benchmark grade, West Texas Intermediate (WTI), ended at $12.23 a barrel based on settlements, after the spread shrank to $11.07 intraday. Brent's premium is off more than $5 since the start of the month.
"We've seen a narrowing of the Brent-WTI contract and that's trying to stabilize," said Gene McGillian, an energy analyst at Tradition Energy in Stamford, Connecticut.
In data released after futures settled, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday that money managers raised their net long U.S. crude futures and options positions in the week to December 10. (Additional reporting by Anna Louie Sussman in New York, Joshua Franklin in London and Florence Tan in Singapore; Editing by Christopher Johnson, Jane Baird, Dale Hudson, Peter Galloway, David Gregorio and Andrew Hay)
Sept 26 TransCanada Corp said on Monday its unit, Columbia Pipeline Group, offered to buy Columbia Pipeline Partners LP for about $848 million in cash.
SOFIA, Sept 26 Bulgaria would hope to attract natural gas from Cyprus if its planned gas hub at the Black Sea, to transport gas from Russia and the Caspian Sea to southern and central Europe, goes ahead, it said on Monday.