* Spain's bank takeover weakens euro, curbs oil rise
* Libya oil minister says OPEC concerned about price fall
* Coming up: API oil inventory data; Tuesday 4:30 p.m. EDT
(Recasts, updates prices, changes byline, dateline previous
LONDON)
By Robert Gibbons
NEW YORK, May 24 (Reuters) - U.S. crude rose on Monday,
struggling in choppy trading to stay above $70 a barrel despite
high oil inventories and continued worries that Europe's debt
problems may keep demand growth curbed.
U.S. crude <CLc1> rose 40 cents to $70.44 a barrel at 12:48
p.m. EDT (1648 GMT), having traded in a range from $69.57 to
$70.96. Brent crude <LCOc1> was down 11 cents at $71.57.
"Oil futures are up but the market still has fears.
Earlier, it was the news from Spain on the takeover of a small
bank and now it's back to China as investors wonder if it will
take steps that would pull down its economy," said Phil Flynn,
analyst at PFGBest Research in Chicago.
Flynn also cited tensions between South Korea and North
Korea over the sinking of a navy ship as a supportive factor.
[]
The euro fell broadly, pulling back from gains last week,
after the Spanish central bank's takeover of a savings bank
added to jitters about debt problems in some of the weak euro
zone countries. []
The Nasdaq gained after positive broker comments lifted
technology shares, but concerns about Europe's banking system
restrained the Dow and the S&P 500 indexes. []
Oil markets remain well supplied with the Organization of
the Petroleum Exporting Countries pumping about 2 million
barrels per day above output targets.
"The fundamentals of oil haven't suddenly changed. There's
still plenty of oil about," said Rob Montefusco, a commodity
broker at Sucden Financial.
While oil hovers near the low end of the $70-$80 range many
in OPEC have said they prefer, OPEC officials have not yet
called for any steps to prop up prices. The group is not
scheduled to meet until October.
Shokri Ghanem, the chairman of Libya's National Oil
Corporation, said that OPEC was very worried about and eyeing
closely falling oil prices. []
Ghanem echoed other OPEC officials that have said it was
too early to tell if the price slide would require action.
Total U.S. crude inventories have been rising and stocks at
the delivery hub for U.S. futures contracts in Cushing,
Oklahoma, are at a record high.
The Cushing stocks have helped keep front-month U.S. crude
futures priced at a discount to the next nearby contract
<CL-1=R>.
Last Thursday's $64.24 intraday low front-month crude price
was the weakest front-month price since $62.76 was struck on
July 30, 2009. Prices have plunged since a 2010 peak of $87.13
was hit May 3.
Last week, money managers sharply cut net crude oil long
positions on the New York Mercantile Exchange in the week to
May 18, Commodity Futures Trading Commission data showed on
Friday. []
U.N. Secretary-General Ban Ki-moon said he was confident
the Security Council would take "appropriate" measures
regarding the alleged sinking of a South Korean naval ship by
North Korea. []
Another global dispute helping to support oil is Iran's
dispute over its nuclear program. Iran outlined to the U.N.
nuclear watchdog a deal to give up some of its enriched uranium
but diplomats said the gesture would have no effect on a push
to widen sanctions against Iran. []
Some analysts and brokers in the oil market expect prices
to recover given the demand coming from emerging economies.
World oil demand is expected to rise by 1.62 million
barrels per day in 2010, led by emerging economies like China,
according to the International Energy Agency. Global
consumption declined in 2009.
"I think the weakness last week was a bit overdone when you
look at the incredibly strong demand data from China," said
Christopher Bellew, a broker at Bache Commodities. "It probably
won't stay down here too long."
(Additional reporting by Gene Ramos in New York, Alex Lawler
in London and Fayen Wong in Perth; Editing by Marguerita Choy)
