* Demand worries, high inventories continue to weigh
* U.S. durable goods sales down, home sales disappoint
* Iran nuclear controversy supports
(Recasts, updates prices)
By Rebekah Kebede
NEW YORK, Sept 25 (Reuters) - Oil prices rose slightly on
Friday after tension around Iran's nuclear program and
improving consumer sentiment outweighed poor U.S. economic
indicators.
U.S. crude futures <CLc1> settled at $66.02, up 13 cents.
In London, Brent crude <LCOc1> settled at $65.11 a barrel,
up 29 cents.
Oil prices climbed after U.S. President Barack Obama
accused OPEC member Iran of building a secret nuclear fuel
plant and demanded Tehran immediately halt what he called a
"direct challenge" to the international community.
[]
In recent years, tensions over Tehran's nuclear program
have supported oil prices, but analysts said that large amounts
of spare oil production capacity helped ease concerns over
supply.
"I think the risk of geopolitical supply shock is muted
somewhat by OPEC spare capacity being higher and U.S.
commercial inventories being at a high level. But that being
said, if you have a situation that affects the supply chain,
all bets are off," said Rachel Ziemba, lead energy analyst at
RGE Monitor in New York.
In late 2008, Iran threatened to block the Strait of
Hormuz, the sea route through which approximately 40 percent of
the world's globally traded oil passes, when tensions escalated
in another row with the United States around the nuclear
program.
A Reuters/University of Michigan survey showing that U.S.
consumer sentiment rose in late September was also supportive
to oil prices.
But some gloomy economic news added to concerns about an
oil demand recovery in the world's top consumer and tempered
price gains. []
U.S. durable goods orders dropped by the largest amount in
seven months while a rise in new home sales was less than
forecast, according to reports from the U.S. Commerce
Department on Friday. []
Oil had fallen by about $6 in the past two trading sessions
after government figures on Wednesday showed crude and fuel
inventories in the United States had risen again, suggesting
oil demand was still weak.
Oil prices have been trapped in a range of between $65 and
$75 for about two months. A lack of significant developments in
fundamentals of supply and demand, which have remained slack
all year, has forced investors to seek direction from technical
chart analysis, equities and foreign exchange markets.
In a research note published on Friday, Goldman Sachs said
range-bound trading reflected "the end of a recession" and
maintained its oil price forecasts, but raised its forecast for
global oil demand. []
(Additional reporting by Robert Gibbons and Gene Ramos in New
York, Ikuko Kurahone in London and Fayen Wong in Perth; Editing
by Christian Wiessner)
