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SINGAPORE, March 7 (Reuters) - Brent crude futures eased to trade just under $111 per barrel on Thursday as traders eyed central bank meetings and economic data this week to give a better picture on the prospects for oil demand in the world’s top consumers.
The Bank of Japan (BoJ) and the European Central Bank (ECB) are meeting this week, with both outcomes expected later on Thursday. Traders are watching the BoJ for cues on whether its easing policy may be brought forward, and the ECB’s outlook for the economy following recent dismal numbers.
“We have a busy end of the week as far as macro economic data is concerned; the oil markets are watching out for those and all eyes are on BOJ at the moment,” said Ben le Brun, an analyst at OptionsXpress in Sydney.
Front-month Brent futures were trading 10 cents lower at $110.96 per barrel by 0218 GMT, after trading in a broad range of $110.46-$112.23 in the previous session. Brent is expected to test resistance at 111.83 per barrel, according to Reuters analyst Wang Tao.
U.S. crude added 2 cents to $90.45 per barrel after weakening in the previous session following higher than expected inventory numbers.
U.S. crude stocks rose by 3.83 million barrels in the week to March 1, the Energy Information Administration said in its weekly report. Analysts had forecast a 500,000-barrel build.
Inventories rose as refinery utilization fell during winter plant maintenance season and in spite of a drop in imports to the world’s biggest oil consumer.
“The fact that U.S. crude stocks surged nearly eight times more than expected does point to weaker demand, which will weigh on the WTI,” le Brun said, referring to the Western Texas Intermediate, the benchmark for U.S. crude.
The weak market tone was aggravated by a stronger U.S. currency, which makes dollar-denominated commodities more expensive outside the United States. The dollar index is trading at its highest in more than six months.
Bank of Japan is likely to hold off announcing new stimulus measures until its next meeting on April 3-4, when Asian Development Bank President Haruhiko Kuroda, a vocal advocate of aggressive easing, is expected to be installed as the central bank’s new governor. (Reporting by Ramya Venugopal; Editing by Ed Davies)