Oil prices ease slightly

Published June 2, 2007

LONDON, June 1: World oil prices stabilised on Friday as traders examined a surprise decline in US crude stocks and fresh production disruptions in key crude exporter Nigeria.

Brent North Sea crude for July delivery slid 13 cents to $67.91 per barrel in electronic deals.

New York's main oil futures contract, light sweet crude for delivery in July, firmed 32 cents to $64.33 per barrel in floor trading.

“Crude futures were little changed on Friday, struggling to find direction following yesterday's US inventories report which showed a surprise draw in crude stocks,” said Sucden analyst Michael Davies.

Prices had risen on Thursday after the US Department of Energy said that American crude reserves fell 2m to 342.2 million barrels in the week ending May 25. That surprised analysts who forecast an increase of 1 million.

Gasoline stockpiles rose by 1.3m to 198m barrels last week -- which was less than market expectations for an increase of 1.5m.

Below-average stock levels of gasoline had sent crude prices surging last week. The US driving season, which began last weekend, sees many Americans hit the highways for their holidays -- sparking a rush for gasoline.

Davies added: “However, the market continues to draw support from geopolitical concern and especially from civil unrest in Nigeria.” ”This morning there was news of further violence in Nigeria, where currently just over 900,000 barrels per day of the country’s oil output has been shut in as a result of militant attacks on oil facilities.” —AFP