NYMEX-Crude drops below $97 on stock buildup, pipeline worries
PERTH, April 3 (Reuters) - U.S. crude futures dropped below $97 per barrel on Wednesday after data showed a sharp build in inventories in the world's top oil consumer, while the possibility of a prolonged pipeline outage in the Midwest also hurt prices.
FUNDAMENTALS
* U.S. crude for May delivery fell 53 cents to $96.66 per barrel at 0027 GMT on Wednesday. Brent crude dropped 44 cents a barrel to $110.25 per barrel.
* U.S. oil is expected to test support at $95.80 per barrel, as a correction from Monday's high of $97.80 will extend, according to a Reuters technical analysis.
* U.S. crude oil stocks rose 4.7 million barrels for the week ended March 29, data from industry group the American Petroleum Institute showed on Tuesday, higher than the 2.2 million predicted by a Reuters poll.
* The U.S. government's Energy Information Administration (EIA) releases its more closely watched report on U.S. oil inventories at 10:30 am EDT (1430 GMT) on Wednesday.
* Uncertainty surrounding the impact of the ruptured Exxon Mobil Pegasus pipeline in the U.S. Midwest continued to weigh on crude prices.
* The pipeline problem is likely to keep crude oil bottled up in the Midwest, depressing prices, as stockpiles of oil should build up near the delivery point of the U.S. crude oil benchmark contract in Cushing, Oklahoma. The 65-year-old pipeline pumps 90,000 barrels per day of crude through the U.S. Midwest to Texas.
* U.S. pipeline regulators on Tuesday ordered Exxon to take necessary corrective action for the ruptured pipeline that spilled thousands of barrels of crude oil into a small Arkansas housing development last week.
MARKETS NEWS
* Asian shares were effectively flat in Wednesday morning trade, cautiously marking time before key U.S. jobs data and news from central bank policy meetings in Japan and Europe later in the week.
* The yen retreated from a one-month high against the dollar early in Asia on Wednesday, while the euro was subdued in a market largely lacking conviction as investors await policy decisions by the Bank of Japan and European Central Bank.
DATA/EVENTS (GMT)
0900 Euro zone Flash inflation
1215 U.S. ADP employment report
1400 U.S. ISM non-manufacturing index
1430 U.S. EIA oil inventory data
(Reporting by Rebekah Kebede; Editing by Himani Sarkar)