* Front-month contract depressed due to expiry -traders
* Technicals show crude headed for $76.02 []
* Coming Up: U.S. API weekly oil stocks; 2030 GMT
(Adds graphic, updates prices)
By Christopher Johnson
LONDON, Sept 21 (Reuters) - Oil slipped towards $74 per
barrel on Tuesday on concerns over the outlook for the global
economy ahead of a key Federal Reserve meeting to decide U.S.
monetary policy.
The Federal Reserve is expected to restate its existing
policy with no fresh stimulus and interest rates kept at almost
zero but is coming under increasing pressure to print more money
to bolster its sluggish economy. []
U.S. crude for October <CLc1> fell 61 cents to $74.25 per
barrel by 0900 GMT, a much sharper fall than contracts further
out, ahead of its expiry later on Tuesday. The November U.S.
crude contract shed only 40 cents to $75.79.
"Market sentiment seems surprisingly positive given the
recent stream of not-so-encouraging economic news," David Wech,
head of energy studies at JBC Energy in Vienna said.
"Given the baseline expectations for today's Fed decision
... any potential (but unlikely) surprises are likely to provide
an upside to oil prices."
Stock markets were generally stronger on Tuesday with
Japan's Nikkei average hitting a seven-week intraday high after
the S&P 500 <.SPX> hit a four-month high on Monday. European
stocks were also a higher. [] [] []
ICE Brent <LCOc1> for November was much more buoyant than
U.S. crude, trading not far off Monday's close of $79.32 per
barrel, supported by healthy physical demand for oil in Europe
and relatively tight supplies of crude from the North Sea.
November Brent traded more than $3 above the equivalent
contract for U.S. crude. The premium shrank below $2 last week
after a leak forced the closure of the biggest Canada-U.S. crude
pipeline but widened out again after flows resumed.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic of the growing premium for North Sea Brent
futures over U.S. light crude oil (November vs November), click:
http://link.reuters.com/buc74p
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
CHINESE DATA
Chinese figures offered some support for prices on Tuesday.
China's apparent oil demand rose 8.2 percent in August over
a year earlier, rebounding from July when refineries scaled back
crude purchases and throughput from June peaks, Reuters
calculations from official data showed. []
But the U.S. economy is sluggish, industry figures suggest.
U.S. home-builder sentiment was stuck at a one-and-a-half-year
low in September, another sign the sector is in for a long and
slow recovery. []
Industry group the American Petroleum Institute will publish
U.S. oil inventory data for the week to Sept. 17 at 2030 GMT on
Tuesday. The U.S. Energy Information Administration will release
its oil data on Wednesday at 1430 GMT.
Crude inventories probably fell by 1.9 million barrels last
week due to lower imports from Canada because of the Enbridge
pipeline outage and as tankers navigated around stormy weather,
a Reuters survey of analysts showed on Monday. []
Ministers of the Organization of the Petroleum Exporting
Countries meet next month and are likely to keep oil production
targets unchanged since prices have been relatively steady
within $70 and $80 per barrel this year.
OPEC ministers and economists in oil consuming countries
have said over the last year that this $70-$80 range is ideal
for oil because it is high enough to encourage new investment in
production but not high enough to choke off demand.
"OPEC have no motivation to change policy," said Wech. "They
have a history of not doing anything unless they have to and we
can't see anything driving a change at this point."
(Additional reporting by Alejandro Barbajosa in Singapore;
editing by Vera Eckert
