Crude oil settled down -1.42% at 5705 edged to 6-month lows after Wednesday's U. S. inventory data continued to dampen spirits, while ongoing expectations for Libya to ramp up its output to normal levels also pressured prices lower. Wednesday's supply data continued to pressure prices lower on Thursday, especially figures on refined crude products. The U. S. EIA said in its weekly report that U. S. crude oil inventories fell by 2.68mbls in the week ended Jan. 3, beating expectations for a decline of 849kbls. Total U. S. crude oil inventories stood at 357.9mbls as of last week. The report also showed that total motor gasoline inventories increased by 6.24mbls, significantly higher than expectations for a gain of 2.28mbls. Meanwhile inventories of distillates, which include diesel fuel and heating oil, rose by 5.83mbls compared to market calls for a gain of 1.90 million. The hikes in refined oil products sent prices falling as did Libyan supply concerns. Oil prices have fallen in recent sessions on expectations for Libyan production to approach normal levels and add to global supply. Libya is reportedly producing about 650kbls of oil a day, about half of normal capacity through up from 100, kbd produced in 2013, when protesters disrupted operations a key fields. China's crude oil imports rose 4% in 2013 from the year before to reach 280 million tonnes, customs data showed on Friday, slowing from a near 7% increase in 2012. Now Investors will look to U. S. nonfarm payrolls data to be released on Friday for signs of continued recovery in the world's largest economy. Technically market is getting support at 5676 and below same could see a test of 5646 level, And resistance is now likely to be seen at 5760, a move above could see prices testing 5814.

Trading Ideas:

Crudeoil trading range for the day is 5646-5814.

Crude oil dropped after Wednesday's U. S. inventory data continued to dampen spirits, while ongoing expectations for Libya to ramp up its output to normal levels also pressured

Overall U. S. crude inventories fell for the sixth straight week, totalling 33.5 million barrels for the period, the largest six-week drop since October 1990.

Libya is now producing around 650,000 bpd of oil, of which 510,000 bpd is being exported, Oil Minister Abdelbari Arusi told.