Crude Oil Ends Lower On Iran Talks, Ahead Of Supply Data

(RTTNews) - U.S. crude oil ended lower for fourth straight session on Tuesday, ahead of the weekly oil report and amid reports of progress in the talks between Iran and world powers over Tehran's nuclear program. Meanwhile, traders await the outcome from the crucial Federal Reserve meeting that may signal interest rate hikes this summer, even as the supply data remained in focus.

Iran's nuclear chief Ali Akbar Salehi indicated progress in talks with the world powers, indicating agreement on some of the main issues. While Iran exuded confidence of a deal, the American and European officials remained cautious. Tehran expects a deal could see easing sanctions against it, which could translate to more oil in the already over-supplied market.

Prices have plunged in the past six months, with the epic collapse brought on by a stronger dollar, burgeoning inventories and an unwillingness from major producers to trim output.

Meanwhile, it is widely expected the Federal Reserve will withdraw its pledge to remain patient on raising interest rates in light of improvements in the broader U.S. economy. The market expects the Fed would hike interest rates either in June or August.

The prospect for increased global energy demand remains weak, given the problems facing Europe and Asia. The Bank of Japan kept its massive stimulus unchanged on Tuesday, while cautioning that inflation may slow to about zero percent.

Light Sweet Crude Oil futures for April delivery, the most actively traded contract, dropped $0.42 or 1 percent to settle at $43.46 a barrel on the New York Mercantile Exchange Tuesday.

Crude prices for April delivery scaled a high of $44.20 a barrel intraday and a low of $42.68

On Monday, U.S. crude futures settled lower by $0.96 at $43.88, having touched a 2009 low below $43 earlier intraday. Crude oil prices tumbled to their lowest in six years amid speculation that stockpiles will continue to build in the U.S. and elsewhere.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 99.58 on Tuesday, down from its previous close of 99.70 on Monday in late North American trade. The dollar scaled a high of 99.83 intraday and a low of 99.23.

The euro trended higher against the dollar at $1.0599 on Tuesday, as compared to its previous close of $1.0570 in North American trade late Monday. The euro scaled a high of $1.0651 intraday and a low of $1.0552.

In economic news, new residential construction in the U.S. showed a substantial decrease in February, a report from the Commerce Department on Tuesday. Housing starts plummeted by 17.0 percent to an annual rate of 897,000 in February from the revised January estimate of 1.081 million. Economists expected housing starts to dip to 1.048 million from the 1.065 million originally reported for the previous month.

Meanwhile, the Commerce Department said building permits climbed 3.0 percent to an annual rate of 1.092 million in February from the revised January rate of 1.060 million. Building permits, an indicator of future housing demand, had been expected to inch up to 1.058 million from the 1.053 million originally reported for January.

Eurozone employment grew at a slower pace at the end of 2014, data from Eurostat showed Tuesday. Employment rose 0.1 percent in the fourth quarter from a quarter ago, which was slower than the 0.2 percent rise in the third quarter and 0.3 percent in the second quarter.

Eurozone consumer prices remained negative for the third month in February as initially estimated, final report from Eurostat showed Tuesday. The harmonized index of consumer prices fell 0.3 percent in February from last year, slower than January's 0.6 percent decline. The annual decrease came in line with the flash estimate published on March 2.

German investor sentiment strengthened for the fifth consecutive month in March to its highest level in a year, a closely watched survey revealed Tuesday. Nonetheless, the improvement was weaker than expected, suggesting that concerns over the Greek crisis impacted optimism.

The economic sentiment indicator climbed to 54.8 from 53 in February, survey data from the Centre for European Economic Research, or ZEW, showed Tuesday. It was the highest value of the index since February 2014. Economists had expected a higher score of 59.4.

The leading economic index in the UK, which measures the future economic activity, increased at the start of the year, figures from the Conference Board showed Monday. The Conference Board leading economic index rose 0.2 percent in January, after staying flat in the previous month. In November, the index had dropped 0.4 percent.