Crude Oil Ends Below $98 Ahead Of Supply Data

(RTTNews) - U.S. crude oil ended lower Tuesday, ahead of the official weekly report on U.S. crude oil stockpiles, as investors continued to worry over developments in Ukraine and the Middle East.

According to reports, pro-Russian separatists fired on unarmed Ukraine soldiers earlier in the day, although there is no official information about any casualties.

Meanwhile, a 72-hour ceasefire has come into effect in Gaza and the stage now appears set for discussions in Egypt for finding a solution to end the month-long conflict.

The situation in the Middle East continued to aggravate with militants in Iraq in controlling the country's biggest dam, some important oil fields, and several towns.

Crude prices were impacted ahead of official weekly oil inventory data from the U.S. Energy Information Administration due Wednesday. Analysts anticipate crude oil stocks and gasoline supply to drop, while distillates are expected to rise. Later today, the American Petroleum Institute will release its weekly oil report.

Last week, the official data from EIA had showed crude oil inventories to have dropped by a more than expected 3.7 million barrels in the week ended July 25.

Light Sweet Crude Oil futures for September delivery, the most actively traded contract, dropped $0.91 or 0.9 percent to close at $97.38 a barrel on the New York Mercantile Exchange Tuesday.

Crude prices for September delivery scaled a high of $98.67 a barrel intraday and a low of $97.00.

On Monday, crude oil futures ended higher, snapping a five-day losing streak, amid renewed geopolitical concerns.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.57 on Tuesday, up from its previous close of 81.32 late Tuesday in North American trade. The dollar scaled a high of 81.63 intraday and a low of 81.29.

The euro traded lower against the dollar at $1.3365 on Tuesday, as compared to its previous close of $1.3422 late Monday in North American trade. The euro scaled a high of $1.3425 intraday and a low of $1.3410.

In economic news, data from the Commerce Department showed U.S. factory orders to have jumped by a more than expected 1.1 percent in June, following a revised 0.6 percent decrease in May. Economists expected orders to increase by about 0.6 percent compared to the 0.5 percent drop originally reported for the previous month.

A report from the Institute of Supply Management showed activity in the U.S. service sector expanded at a notably faster rate in July, with the non-manufacturing index climbing to 58.7, the highest reading since its inception in January 2008. Economists expected the index to edge up to a reading of 56.5.

From Europe, U.K. services activity growth strengthened to an eight-month high in July indicating that the dominant sector is set to boost economic growth again in the third quarter and raises possibilities that the Bank of England will bring forward its first interest rate hike into late 2014. The headline Chartered Institute of Purchasing & Supply/Markit Purchasing Managers' Index rose to 59.1 in July, an eight-month high, from 57.7 in June, survey data revealed Tuesday.