SINGAPORE (Reuters) – Oil prices eased on Thursday but held near $61.50 a barrel after a climb the previous day on unexpectedly large falls in U.S. fuel inventories.
U.S. crude slipped 12 cents to $61.67 a barrel by 0831 GMT, after ending 33 cents higher on Wednesday. London Brent crude traded 18 cents down at $61.71.
U.S. government inventory data on Wednesday showed stockpiles of distillates, including heating oil, fell 3.8 million barrels while gasoline slid 1.9 million barrels as overall demand remained strong and refinery work cut supplies.
“We continue to believe that oil product inventories, especially in the U.S., will shrink with the refinery turnaround season,” said John Herrlin at Merrill Lynch.
A rash of problems at North American oil refineries have added to concerns about fuel supplies as companies get ready for the peak summer driving season.
The inventory data bolstered a market worried about economic strength after data on Wednesday showed growth in the economy of top energy consumer the United States during the fourth quarter of 2006 came in below expectations.
Investor confidence in global stock markets has also been rattled this week, with Asian stocks extending losses on Thursday despite a recovery on Wall Street from a global sell-off that saw many markets suffer their worst one-day drops since the September 11, 2001 attacks.
But analysts said the oil market has remained insulated from following stock market slides by reduced U.S. oil inventories after supply curbs by OPEC producers and stronger fuel demand.
“The switch in sentiment and the tightening of the oil market suggest that prices might be more robust this time in the face of equity developments,” said Barclays Capital in a report.
Worries over Iran’s dispute with the West over its nuclear program have also been a supportive factor, after the OPEC producer maintained it will never suspend uranium enrichment even as world powers work on a U.N. resolution to up the pressure.