Oil prices rise on increased U.S. stocks

Oil prices rise on increased U.S. stocks

Oil prices rose on Thursday but remained around US$63 per barrel as an increase in crude reserves in the United States eased worries of tight supplies, dealers said.

New York's main contract, light sweet crude for delivery in September, added 10 U.S. cents to $63.35 per barrel in electronic trade.

In London, the price of Brent North Sea crude oil for delivery in October gained 24 cents to $62.80 a barrel.

Recent supply fears, heightened by production outages at U.S. refineries, had pushed New York futures to a historic high of $67.10 last Friday, and to $66.85 in London on Monday.

Crude prices tumbled on Wednesday as the market reacted to data showing stronger U.S. reserves of crude but sharply lower gasoline stocks.

"I think the crude inventory is still too high to justify 70 dollars so the market got ahead of itself," said Tony Nunan, manager for energy risk management at Mitsubishi Corp's international petroleum business in Tokyo.

The weekly U.S. Department of Energy (DoE) petroleum report released on Wednesday showed crude oil inventories rose by 0.3 million barrels to 321.1 million barrels in the week to Aug. 12 -- above the upper end of the average range at this time of the year.

It said gasoline stockpiles fell by 5.0 million barrels in the week to Aug. 12, the seventh straight weekly decline and was far more than forecasts of a 1.5-million-barrel drop.

The decline, which came as U.S. oil companies drew down their stocks to cope with summer driving demand, put levels of gasoline supplies "near the bottom end of the average range" for this time of year, the DoE said.

Stockpiles of distillate fuel, which make heating oil and diesel, increased by 1.2 million barrels to 131.1 million, in line with market expectations of a 1.6-million-barrel increase. -- AFP