Crude oil settled down -1.98% at 5897 as the market braced for rising Libyan output, while soft Chinese service-sector data softened demand for the growth-sensitive commodity as well. Ongoing expectations for Libyan oil exports to resume to near normal levels sent prices falling due to the added supply they'd bring to the global market. Libyan oil operations faced glitches in the recent past due to protesters disrupting production at various oilfields. Expectations for increased exports from South Sudan also nudged prices lower. An increase in oil exports from the OPEC member, which have dropped to less than 250,000 barrels per day (bpd) from 1.4 million bpd in July, would boost supply and weigh on prices. Prices also slumped after data showed that China's non-manufacturing purchasing managers' index fell to 54.6 in December from 56.0 the previous month. The U. S. Energy Information Administration reported in its weekly report earlier that U. S. crude oil inventories fell by 7.01 million barrels in the week last week, far surpassing market expectations for a decline of 2.98 million barrels. The report also showed that total motor gasoline inventories fell by 844,000 barrels compared to expectations for a gain of 1.93 million barrels. However, the government added that distillate fuel, which includes diesel and heating oil, rose by 5.04 million barrels, defying market calls for a gain of 1.23 million, which overshadowed crude's losses. Now Crudeoil is getting support at 5853 and below same could see a test of 5809 level, And resistance is now likely to be seen at 5970, a move above could see prices testing 6043.

Trading Ideas:

Crudeoil trading range for the day is 5809-6043.

Crude oil dropped as the market braced for rising Libyan output, while soft Chinese service-sector data softened demand.

The U. S. EIA reported in its weekly report that U. S. crude oil inventories fell by 7.01 million barrels in the week last week

Expectations for increased exports from South Sudan also nudged prices lower.