LONDON, Nov 15: World oil prices fell sharply on Thursday on easing supply concerns as Opec lowered its estimate for demand growth and the US government revealed a surprise increase to crude stockpiles, traders said.

New York’s main contract, light sweet crude for December delivery, slumped $2.06 to $92.15 per barrel.

In London, Brent North Sea crude for December delivery shed 67 cents to $90.69 per barrel. Brent’s December contract expires at the close.

Opec on Thursday lowered its estimate for world oil demand growth in 2007, arguing that high petrol prices were reducing consumption.

It came as ministers from the Organisation of Petroleum Exporting Countries were defiant in the face of pressure from consumer nations to raise oil output, saying the market was amply supplied and that blame for near $100 prices lay outside the cartel.

Last week, New York’s main contract struck an historic peak of $98.62 and Brent raced to an all-time high of $95.19 d on fears of tight energy supplies in the United States, the world’s biggest energy user.

The US government on Thursday revealed that domestic stockpiles of crude had jumped by 2.8 million barrels to 314.7 million in the week ending November 9.

Analysts had forecast a fall of 750,000 barrels. However, inventories of distillates dropped by 2 million barrels last week to 133.4 million. Analysts had predicted a fall of only 500,000 barrels.

The distillates report is being closely watched as the United States heads into the northern hemisphere winter, when demand for heating fuel typically peaks.

Meanwhile, in Riyadh on Thursday, Opec president Mohammad al-Hamli said current high oil prices are “potentially dangerous” as they are driven by factors that are beyond the 12-member cartel’s control.

“These prices are potentially dangerous,” Hamli, who is also the oil minister of the third largest Opec producer United Arab Emirates (UAE), told a symposium held as part of a rare Opec summit.

Saudi Arabia, Opec’s biggest and most influential member, earlier this week described fears of supply shortages as “groundless” and Opec secretary-general Abdallah al-Badri on Wednesday voiced his opposition to an increase.

They blame a declining dollar, speculation by investment funds and geopolitical factors for record prices of more than $90 per barrel. —AFP