* N.American Enbridge pipeline expected to restart Friday
* Technicals show bear trend towards $74 []
* Coming Up: U.S. Initial jobless claims; 1230 GMT
(Adds graphic, updates prices)
By Christopher Johnson
LONDON, Sept 16 (Reuters) - Oil fell for a third day on
Thursday ahead of the restart of a key North American pipeline
that will restore crude supplies to U.S. refiners.
U.S. regulators will allow the 670,000-barrel-per-day (bpd)
Enbridge pipeline, which carries oil from Canada to the American
heartland to reopen on Friday following repairs after a one-week
closure, pipeline company Enbridge Inc <ENB.TO>. []
U.S. crude futures for October <CLc1>, also known as WTI,
fell to a low of $75 a barrel before recovering to around
$75.20, down 82 cents, by 0828 GMT. The contract hit a one-month
high above $78 on Monday on concerns over the Enbridge outage.
The reopening of the pipeline will remove a major support
for prices, which some traders believe could now slip lower.
"For the time being, WTI prices should continue trading
within the $70-$80 range, but as we exit the hurricane season,
defending downside support at $70 will become an increasingly
difficult proposition," said Edward Meir, senior commodity
analyst at brokers MF Global.
The Pipeline and Hazardous Materials Safety Administration
(PHMSA), which oversees U.S. pipelines, has yet to confirm when
the Enbridge pipeline will restart.
The pipeline affected, Line 6A, is the main artery of
Enbridge's Lakehead Pipeline System, the backbone of U.S. oil
imports from top supplier Canada. The line feeds refineries with
a combined capacity of more than 1 million barrels per day (bpd)
in the Chicago area and connects with a spur that reaches a key
storage hub in Cushing, Oklahoma.
For a map: http://link.reuters.com/mes92p
The pipeline's Sept. 9 shutdown raised expectations that
high inventories at Cushing would start to drain, bringing WTI
more in line with strong values for European marker Brent.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
TAKE A LOOK-Enbridge crude line shut []
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
MARKET SHRUGS OFF STOCKDRAWS
But drops last week in petroleum stockpiles held by the
U.S., the world's top oil consumer, did little to worries over a
surplus of crude oil.
U.S. crude oil inventories fell last week by 2.49 million
barrels to 357.37 million barrels, in line with expectations,
and product stocks fell, according to a weekly report from the
Energy Information Administration on Wednesday. []
U.S. distillate stocks including diesel fell 340,000
barrels, against analyst expectations for a 300,000 barrel gain,
while gasoline stocks fell 694,000 barrels, as expected.
ICE Brent crude for November <LCOc1>, the front month after
October's expiry on Wednesday, declined 65 cents to $78.77 by
0828 GMT, maintaining a hefty premium against front-month WTI.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic showing the premium for Brent crude over WTI,
click: http://link.reuters.com/vaj93p
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
"With the latest Norwegian production statistics revealing a
year-on-year fall in output in August of 417,000 barrels per
day, the heaviest fall in any month in more than three years,
combined with relatively low European crude inventories and the
dispersal of floating storage, it is not difficult to find a set
of reasons why the Brent market should be considerably tighter
than that of WTI," Barclays Capital analysts said in a report.
Tropical Storm Karl hit Mexico's Yucatan Peninsula on
Wednesday and could reach hurricane strength once it enters the
Gulf of Mexico, where it could swing past major Mexican oil
installations. []
(Additional reporting by Alejandro Barbajosa; editing by XXX
