Brent falls, U.S. crude up awaiting ECB, jobs data

Brent crude prices fell on Wednesday, while U.S. crude inched up in seesaw trade ahead of a European Central Bank meeting and a U.S. August payrolls report as investors await central bank action in the face of slowing economic growth.

Crude futures pared losses, copper prices rose and European stocks hit session highs on reports that the ECB is ready to drop preferred creditor status on government bonds it buys.

ECB President Mario Draghi is expected to reveal more details of the bond buying plan following Thursday's meeting.

"Uncertainty about the ECB, after Bernanke's speech didn't provide any stimulus announcement, and the U.S. jobs report on Friday, has kept caution in a market that has bulls looking for a reason to push higher," said Gene McGillian, analyst at Tradition Energy.

McGillian and other brokers and traders said the lack of major damage from Hurricane Isaac to U.S. oil facilities and the return of production should lessen the impact of an expected drop in U.S. oil inventories last week.

In addition to weekly oil inventory reports, investors awaited U.S. August nonfarm payrolls data on Friday because a soft jobs report might strengthen the case for a third round of monetary easing, also known as quantitative easing (QE3), from the Federal Reserve at its September meeting.

Brent October crude fell $1.09 to settle at $113.09 a barrel on Wednesday, after dropping as low as $112.73.

U.S. October crude edged up 6 cents to settle at $95.36 a barrel, having swung from $94.26 to $95.67.

Brent's premium to U.S. crude narrowed to $17.73 a barrel, based on settlements, after reaching $19.68 intraday on Tuesday.

Total Brent trading volume was 12 percent above its 30-day average, while U.S. crude turnover lagged its 30-day average by 7 percent.

U.S. RBOB gasoline futures also seesawed either side of unchanged before settling at $2.9498 a gallon, down 0.08 percent. It fell to $2.9368 but found support ahead of the 200-day moving average of $2.9242.

Heating oil fell nearly 1 percent, but at around $3.11 a gallon, retained a healthy premium to gasoline futures.

The October refined fuels contracts' move into the front-month position puts more focus on distillates ahead of the Northern hemisphere's winter fuel season and with the U.S. summer driving demand now in the rear view mirror.

U.S. retail gasoline demand over the past two weeks leading into the Labor Day holiday edged up 0.1 percent from the year-ago period when Hurricane Irene raked the East Coast and curbed fuel use, MasterCard said in a report.

But the four-week average stayed below the year ago period.

U.S. OIL SUPPLY

Most eastern Louisiana refinery affected by the tempest Isaac have restarted production and producers have continued to restore offshore production.

About 680,749 barrels per day (bpd) of oil production remained offline on Wednesday, according to the U.S. government, just under 50 percent of Gulf of Mexico offshore output.

As of Wednesday, the storm had shut in a total of 11.2 million barrels of oil production since Aug. 25.

With Isaac shutting in production and limiting imports last week, U.S. crude oil, distillate and gasoline inventories are expected to have fallen last week, a Reuters survey of analysts on Monday showed.

U.S. oil inventory reports are delayed this week after Monday's U.S. Labor Day holiday, with industry group the American Petroleum Institute releasing its data at 4:30 p.m. EDT (2030 GMT) on Wednesday. (Additional reporting by Christopher Johnson in London and Ramya Venugopal in Singapore; Editing by Bob Burgdorfer and Marguerita Choy)

1. Post-tornado composting a solution for disposal of dead livestock
2. Cornell genetic testing process cuts cost by up to 75 percent
3. Angus Foundation receives $28,500 from “The Card Challenge”
4. Commentary: In praise of animal foods
5. 100K Pathogen Genome Project maps first genomes
6. Beef exports depend on quality reputation

1. Michigan hay buyers should plan purchases early
2. New animal identification rules aid disease traceability
3. Seven jobs more dangerous than farming
4. Survey reveals most Americans in favor of COOL
5. Corn planting pace turns from record slow to record fast
6. U.S. cattle placements rise in April as feed costs subside

1. Meat and climate change: How significant is the impact?
2. BeefTalk: How do we get the next generation to raise beef?
3. Commentary: GMOs: How do I hate thee?
4. Survey reveals most Americans in favor of COOL
5. Farm bill and immigration reform action needed
6. Boxed beef hits record highs, cattle weak to lower