OIL STEADIED yesterday as US government data showed crude stocks rising and refiners cranking up runs ahead of the summer driving season, easing supply worries which sent prices close to $120 a barrel.
US crude for June was up six cents at $118.03 a barrel in early afternoon US trade. The May contract expired on Tuesday at $119.37 after briefly hitting a record $119.90. London Brent crude rose 24 cents to $116.19 a barrel after hitting a record $116.75 in the previous session.
US crude oil stocks rose by 2.4 million barrels last week, according to the US Energy Information Administration, exceeding analyst forecasts. "There's plenty of crude out there," said Phil Flynn, analyst at Alaron Trading.
The build helped to counter concerns about exports from Nigeria and the North Sea which pushed crude higher earlier this week, while a 4.2 percentage point rise in US refinery runs helped to counter worries of low levels of fuel production ahead of summer holiday travel.
Despite signs that refiners were increasing activity, US gasoline and distillate stocks fell more than analysts had expected, helping to stem an earlier slide in prices.
Oil prices have jumped more than fivefold since 2002 as global supplies stretch to keep pace with surging demand from emerging economies such as China.
Rebel attacks on oil pipelines in OPEC member Nigeria helped to push markets to fresh highs this week, forcing Royal Dutch Shell to declare force majeure on Bonny Light exports after 169,000 barrels per day (bpd) of oil was shuttered. Further support came from potential disruptions stemming from a strike at the Grangemouth refinery in Scotland.
This week energy producers repeated their view that the world might have to live with high oil prices to ensure supplies for the future.
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