LONDON, Jan 7: Oil prices slumped on Wednesday as data revealed larger than expected gains for energy stockpiles in the United States, the world’s biggest crude consuming nation, dealers said.

New York’s main contract, light sweet crude for delivery in February, slid $3.24 to $45.34 a barrel.

Brent North Sea crude for February shed $2.13 to $48.40 a barrel on London’s InterContinental Exchange.

The US government’s Department of Energy said that stockpiles of crude increased by 6.7 million barrels last week, far higher than analysts predictions of a gain totalling only 700,000 barrels.

Inventories of distillates which include heating fuel -- currently in high demand during the ongoing US winter -- meanwhile grew by 1.8 million barrels in the week to January 2, above market expectations of 800,000.

“The builds were much higher then expected,” said Sucden trader Robert Montefusco.

Ahead of the data, oil prices had risen back above 50 dollars this week on supply worries owing to deepening political frictions in Europe and the oil-rich Middle East.

On Tuesday, the New York contract hit an intra-day peak of $50.47 and Brent leapt to 52.21 -- the highest level in more than a month.

Prices had rallied by more than two dollars on Monday after Israel sent soldiers into the Gaza Strip.

Along with the Israeli-Hamas conflict, prices had also risen because of a Russia-Ukraine gas row curtailing supplies to Europe. Shortages of natural gas have spread across Europe, reaching France and Italy.

In addition, freezing temperatures across Europe have also boosted demand for heating fuel.

On Wednesday meanwhile, Libya’s envoy to Opec said the cartel was not considering holding an extraordinary meeting next month, contradicting Iran which said Opec would meet in Kuwait in February.

“So far we are not talking about another meeting,” Libya’s Opec representative Shukri Ghanem told AFP.

Iranian Opec delegate Mohammad Ali Khatibi had on Monday said that the Organization of Petroleum Exporting Countries would hold an extraordinary meeting next month.

But Ghanem said on Wednesday: “Of course as usual we are watching and monitoring the market but for the time being it is not in the plan to meet.”

Opec, whose 12 members together produce about 40 per cent of world oil, last month agreed to cut output by 2.2 million barrels per day in a bid to shore up crude prices.

World oil prices fell by 54 per cent in 2008 as a sharp global economic slowdown weighed on energy demand in the second half of the year.

However, in the first half, crude futures rocketed to record highs of above 147 dollars a barrel in July on fears of supply disruptions.

Towards the end of 2008, prices slumped to just above 33 dollars -- the lowest in four and a half years.—AFP