* Tuesday's FOMC meeting seen setting the tone
* Technicals show U.S. crude targets $71.53 []
* Coming Up: U.S. NAHB housing market index; 1400 GMT
(Adds NYMEX positions, updates prices)
By Alejandro Barbajosa
SINGAPORE, Sept 20 (Reuters) - Oil was steady on Monday
after dropping 3.7 percent last week as investors remained on
the lookout for signs of sustained economic growth in the U.S.
ahead of a key Federal Reserve policy meeting.
U.S. crude for October, which expires on Tuesday, was
unchanged at $73.66 a barrel by 0530 GMT, while ICE Brent for
November rose 12 cents to $78.33.
The Federal Open Market Committee (FOMC) will meet for a
day on Tuesday to take a decision on U.S. interest rates and
issue a policy statement about the economic outlook. The Fed is
expected to tread water with a renewed promise to keep its
portfolio from shrinking but no new steps to ease monetary
policy. []
"If they lower their forecasts as some people are
expecting, oil prices would be pushed down because it implies
lower demand," said Michelle Kwek, an analyst at Informa Global
Markets in Singapore.
The front-month U.S. contract reached a one-month high
above $78 a week ago on expectations of an extended closure of
the biggest Canada-U.S. crude pipeline.
The shutdown also led money managers to raise net-long
crude oil positions on the New York Mercantile Exchange (NYMEX)
to almost 114,000 in the week to Sept. 14, up from less than
78,000 in the previous week, the Commodity Futures Trading
Commission said on Friday. []
But prices retreated later in the week in the run-up to the
duct's restart on Friday.
U.S. consumer sentiment unexpectedly worsened to its weakest
since August 2009, as distress over jobs and finances
intensified among upper-income families, the Thomson
Reuters/University of Michigan preliminary September reading
showed on Friday. []
"The data was poor and sets a very weary outlook for
consumers," Kwek said. "Another major thing is the revival of
European sovereign debt concerns."
The Irish government denied the latest rumours that it
might need help from the International Monetary Fund. The Irish
Independent newspaper had said the nation was "perilously
close" to calling in the Fund and the European Union.
CANADA-U.S. PIPELINE RESTARTS
Enbridge Inc <ENB.TO> said it reopened on Friday the key
pipeline that carries nearly one-third of Canadian crude
shipped to the United States after a leak shut it for more than
a week. []
Enbridge Senior Vice President Art Meyer said the
670,000-barrel per day Line 6A ramped up to flow rates
scheduled for the day within three hours after restart, but he
did not disclose the flow rate or operating pressure.
A longer shutdown could have started to drain U.S.
stockpiles that remain well above year-ago levels, according to
the U.S. Energy Information Administration. Stocks stood at 357
million barrels in the week to Sept. 10, 24.6 million above the
same week in 2009. []
Asian equities saw a cautious start on Monday after U.S.
stocks made modest gains on Friday despite the data showing
soft U.S. consumer sentiment and the re-emergence of concerns
about euro-zone fiscal health.
Japanese markets, which closed at near six-week highs on
Friday, are shut on Monday for a national holiday.
Hurricane Karl spared Mexican oil operations from major
damage after last week sweeping through the Bay of Campeche,
where Mexico produces more than two-thirds of its 2.55 million
bpd of crude output.
An area of low pressure located west of the Cape Verde
islands had an 80 percent likelihood of turning into a tropical
cyclone in the next 48 hours, according to the U.S. National
Hurricane Center.
(Editing by Manash Goswami)
