Oil eases ahead of US inventory data

LONDON - Oil drifted lower on Thursday ahead of US government data expected to show a further fall in US crude oil supplies.

By (Reuters)

Published: Thu 15 Nov 2007, 6:40 PM

Last updated: Sat 4 Apr 2015, 11:17 PM

US light crude for December delivery fell 25 cents to $93.84 a barrel by 1122 GMT after rising almost $3.00 in the previous session.

London Brent crude lost seven cents to $91.21.

Prices rallied briefly after unknown attackers blew up Shell’s crude oil pipeline at Forcados in Nigeria, industry sources said.

The blast forced Shell to reduce output of Forcados oil by less than 50,000 barrels per day. Shell has been trying to restore Forcados production after a series of attacks by militants in Feb. 2006 and had been producing about 70,000 bpd before this latest incident.

The US Energy Information Administration’s latest update on US oil supplies later on Thursday is forecast to show a drop of 800,000 barrels in crude stocks and a decline of 100,000 barrels in distillate inventories, including heating oil.

Falling oil supplies, a weak dollar, investment inflows, as well as political tensions, have driven oil to record levels. Prices have jumped by more than 50 percent so far this year.

Top oil consumer the United States has urged the Organisation of the Petroleum Exporting Countries to increase output.

But OPEC members have blamed speculation and not supply shortages for the record prices, and have confirmed they will not discuss raising crude output at a heads of state meeting on Nov. 17-18.

Nigeria’s oil minister said this would be on the agenda at OPEC’s policy meeting on Dec. 5 in Abu Dhabi.

Asked whether OPEC would raise output then, Odein Ajumogobia said: “We haven’t got the agenda yet but it will certainly be among the issues to be discussed at the Abu Dhabi meeting.”

Concerns that high prices are already hurting global consumption have helped bring oil down from last week’s record high above $98.

“The market is driven now by concerns about demand and the concerns of the impact high prices are already having on consumption,” said Gerard Rigby of Fuel First Consulting in Sydney.

The International Energy Agency (IEA) earlier this week sharply trimmed its global demand growth forecasts and said that high prices were curbing consumption.

And the US Energy Information Administration (EIA) said on Wednesday it was not inevitable that crude costs will reach $100 a barrel. The EIA actually believed oil prices would trend downward, said its chief, Guy Caruso. (Reporting by Jane Merriman and Annika Breidthardt in Singapore; editing by James Jukwey)

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