Oil fell towards $93 a barrel today as investors weighed the prospects for growing stocks of crude in the United States against Venezuela's threat to stop US sales.
US crude dropped 45 cents to $93.14 a barrel earlier today, after ending up almost 2 per cent the previous day. London Brent crude eased 32 cents to $93.21.
Venezuela is the fourth-biggest supplier of crude to the United States, and energy analysts have said any interruption to shipments could tighten inventories and push prices higher.
Venezuelan President Hugo Chavez made the threat on Sunday after Exxon Mobil won a court decision freezing $12 billion of Venezuela's overseas assets, stepping up its push for compensation for the nationalisation of a heavy oil project.
Mr Chavez has often issued conditional threats to stop shipments to the United States but has never followed through with a halt.
While stocks of US crude were plentiful, distillate stocks are expected to show a decline of 1.4 million barrels over the past week.
Leaner supplies of heating fuel and a cold snap in the US northeast limited losses on heating oil, which was trading at $2.5963 a gallon - down 0.3 per cent.