Oil
Holds at $52 as U.S. Supplies Drop
Wed
Apr 20
LONDON
(Reuters) - Oil prices held near $52 on Wednesday as
a U.S. government report showed crude stocks falling
for the first time in 10 weeks and gasoline inventory
dropping ahead of peak summer driving demand.
U.S.
light crude eased 19 cents to $52.10 a barrel, barely
$6 below the record high of $58.28 reached early this
month. Prices jumped $1.92, or nearly 4 percent in New
York on Tuesday, ending a two-week slide.
London
Brent crude gained 16 cents to $53.10 a barrel.
The
U.S. Energy Information Administration said crude stocks,
which have been at the highest level in nearly three
years, dropped 1.8 million barrels to 318.9 million
last week as high import levels eased.
"Inventories
are in the high end of historical averages, and in the
short run, it doesn't do a lot to change the big inventory
picture," said Tom Bentz, analyst at BNP Paribas.
Gasoline
stocks also fell, by 1.5 million barrels to 211.6 barrels,
as demand held strong in the face of higher pump prices
the EIA said.
Gasoline
prices have already rallied on a spate of refinery problems
in Kansas, Louisiana, and Texas, which dealers said
could sap a supply buffer ahead of the summer driving
season when demand for gasoline peaks.
The refinery glitches sent U.S. unleaded gasoline on
NYMEX up by 5 percent on Tuesday. The contract was last
down 1.41 cents to $1.5560 a gallon.
The two-week slide was triggered by rising crude inventories
in the United States, additional OPEC supply and signs
that strong oil demand growth, especially in China,
was easing.
But as China's economy grew by a faster-than-expected
9.5 percent in the year through the first quarter, oil
demand might stay healthy. The pace of economic growth
could force Beijing to further tighten investment and
credit curbs, analysts said.
President Bush said on Tuesday he would raise concerns
about the effects of high energy costs on the global
economy when he meets Saudi Crown Prince Abdullah in
Texas next week.
"I
don't think they're pumping flat out," Bush said,
adding that he planned to ask the Saudi prince whether
it was possible for the kingdom to step up oil production.
"I
think they're near capacity, and so we've just got,
got to get a straight answer from the government as
to what they think their excess capacity is," he
said in an interview with CNBC.
The head of OPEC said on Monday the producers' cartel
would pump near 25-year highs next month although it
would postpone any formal increase in output limits
until a June meeting.
Qatari Oil Minister Abdullah al-Attiyah said on Wednesday
that prices in a $40-$50 range are reasonable. "I
believe there is no shortage of supply. The world will
not face another shock," he said.
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