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Oil prices drop before Fed chief's testimony

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(Globalpost/GlobalPost)

World oil prices fell on Tuesday as traders looked ahead to the latest thoughts of Federal Reserve chief Ben Bernanke on the outlook for the US economy.

Brent North Sea crude for delivery in July dropped 53 cents to $104.27 a barrel in approaching midday in London.

New York's main contract, light sweet crude for June, slipped 24 cents to $96.47 per barrel.

Bernanke will appear before Congress' Joint Economic Committee on Wednesday to give an update on the latest outlook for the world's biggest economy and largest oil consuming nation.

Global markets were expected to closely watch his statements for an indication on when the Fed, the US central bank, will start winding down its massive bond-buying programme to boost the economy.

Analysts meanwhile said that ample global supplies of crude were keeping a lid on prices.

"Crude bulls tried to push prices higher, but high stocks of the fuel tapered gains," Phillip Futures said in a market commentary.

Michael McCarthy, chief market strategist at CMC Markets in Sydney, told AFP that dealers were also waiting for the latest energy inventory report due Wednesday from the United States, where stockpiles have outpaced demand.

"Nothing has really changed in the global picture of demand," McCarthy said.

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http://www.globalpost.com/dispatch/news/afp/130521/oil-prices-drop-fed-chiefs-testimony