>Crude steady, markets wait on macro data

London - Crude oil futures retreated from new multi-month highs Thursday as market participants adopted a cautious approach ahead of a series of key macro readings.

ICE Brent crude earlier reached $76 a barrel for the first time since last October while Nymex crude reached $72.42 a barrel, its highest since the start of July, before turning lower.

Financial markets were largely static awaiting Thursday's interest rate decision from the European Central Bank, weekly U.S. jobless numbers and Friday's crucial U.S. nonfarm payrolls data for any confirmation that economic recovery is underway.

Crude closed higher Wednesday, after a weaker dollar offset the impact of a fresh round of bearish inventory data from the U.S. Energy Information Administration. Prices could strengthen further if economic optimism remains intact, analysts suggested.

"If equity markets continue to improve, and people think tomorrow is going to be better, then presumably there will be more [crude price] upside," Neil Atkinson, senior consultant at KBC Market Services in London said, even though there was "very little fundamental support" for recent rises.

At 1125 GMT, the front-month September Brent contract on London's ICE futures exchange was down 16 cents at $75.35 a barrel.

The front-month September light, sweet, crude contract on the New York Mercantile Exchange was trading 33 cents lower at $71.64 a barrel.

The ICE's gasoil contract for August delivery was up $6.00 at $613.00 a metric ton, while Nymex gasoline for September delivery was up 21 points at 205.33 cents a gallon.

Wednesday's EIA inventory data showed crude stocks continued to rise last week as U.S. refinery utilization remained depressed. Gasoline stocks fell less than expected despite lower runs, although reduced refinery activity contributed to an unexpected drop in distillate stocks. Nonetheless, distillate inventories remain 21% above levels of the same time last year, swollen by a downturn in industrial and economic activity.

Despite indicating that U.S. demand has yet to stage a meaningful recovery, oil prices closed higher after the data Wednesday, largely as other financial markets continued to proffer hopes of economic recovery.

"I'm still not seeing any demand coming from anywhere yet," said Simon Wardell, analyst at Global Insight in London. "This is all about the markets, not the physical desire for crude. We're expecting a correction."

The ECB is due to give its interest rate verdict at 1145 GMT Thursday. The Bank of England left its rates unchanged Thursday, adding that the U.K. recession was deeper than previously thought. In the U.S., meanwhile, weekly jobless claims are due at 1230 GMT.

Those data, as well as Friday's U.S. monthly unemployment report will likely determine crude's next moves, analysts said Thursday, with any mildly positive elements within them likely to keep the crude price on its upwards trajectory.

"For now, and barring a major bearish macro trigger or a return to extremely overbought conditions, it seems that the path of least resistance is higher still," said Edward Meir, analyst at MF Global in New York. "The market does not have the feeling that it wants to go down. Rather, buyers still seem to be stepping up on weakness."

Source: COMMODITIESCONTROL