Crudeoil settled down -0.75% at 6192 dropped on profit booking while support seen earlier amid indications that the U. S. economic recovery is deepening also some concerns about short supplies and reports of improving economic growth in the United States, the world's largest oil consumer. Worries about short supplies have caused the oil market's pricing dynamics to shift in recent days, with prices for nearby delivery of oil rising above prices for forward delivery, Saudi Arabia's oil minister said on Saturday, and played down suggestions that the kingdom was ready to cut production. Force should be used to reopen Libya's oil ports which were seized by a group demanding greater autonomy for the country's eastern part, Meanwhile Libya's oil minister said Saturday. Libya's oil output has dropped to around 250,000 bpd from 1.4 million five months ago. On Wednesday, the Fed announced plans to begin tapering its USD85 billion-a-month bond buying program by USD10 billion after Fed Chairman Ben Bernanke said the economy was continuing to make progress. The U. S. central bank reiterated that interest rates are likely to remain low even after the unemployment rate drops below 6.5%, the threshold at which the Fed has previously said it would start to consider rate increases. Meanwhile, Wednesday's bullish U. S. supply data also supported prices. The EIA said in its weekly report that crude oil inventories fell by 2.9mbls last week to 372.3mbls. Technically market is getting support at 6158 and below same could see a test of 6124 level, And resistance is now likely to be seen at 6222, a move above could see prices testing 6252.

Trading Ideas:

Crudeoil trading range for the day is 6124-6252.

Crude oil dropped but headed for its second weekly gain, buoyed by Libyan supply cuts and a rosy outlook for fuel demand in the United States.

Oil gained after crude stockpiles fell while Fed's decision to start winding down its massive bond buying programme supported the view that economy is on the path to recovery.

In Libya, crude exports have dropped to 110,000 bpd, from over 1 million bpd in July, and the OPEC producer is stepping up fuel imports