NYMEX- Oil prices lower as Spain debt concerns weigh

                                
 * Spain debt worries weigh ahead of eurozone summit
                                
 * Coming up: U.S. Nov housing starts; 1330 GMT

                                
 By Rebekah Kebede	
                                
 PERTH, Dec 16 (Reuters) - Oil prices dipped on Thursday as 
concerns about Spain's sovereign debt rating outweighed data 
showing a much larger than expected drop in U.S. crude 
inventories.	
                                
 	
                                
 FUNDAMENTALS	
                                
 * On the New York Mercantile Exchange, January crude 	
fell 37 cents to $88.25 a barrel by 0029 GMT.	
                                
 * Ratings agency Moody's put Spain's debt on review for a 
possible downgrade on Wednesday, highlighting concerns over a 
funding crunch next year and sending bank shares sliding. The 
ratings agency said it did not expect Madrid to have to follow 
Greece and Ireland into taking a European Union bailout, but 
added that it could not rule out that scenario. [ID:nL3E6NF0D8]	
                                
 * U.S. crude oil stockpiles fell 9.85 million barrels last 
week, according to the Energy Information Administration, much 
more than the drop of 2.5 million barrels expected. Gasoline 
stockpiles rose less than expected and distillates rose 
against a forecast for a supply drop. 
                                
 * The premium of Brent crude over NYMEX benchmark West 
Texas Intermediate crude rose to the highest level in seven 
months, pushed up by a big increase in crude oil stocks stored 
at the key NYMEX delivery hub at Cushing, Oklahoma. 
[ID:nN15165392]	
                                
 * Cold winter temperatures are expected to boost energy 
demand for heating in several regions including the U.S. 
Northeast, parts of Europe, Japan, and Korea. In Europe, 
colder central and eastern areas the next few days, and 
variable to cooler western locales late week/weekend with 
energy demand for heating above average.	
                                
 * In Europe, strong North Sea winds on Thursday will 
generate very rough seas and poor to dangerous conditions for 
oil transport and platform operations in the 
region.[ID:nDTN879] 	
                                
 	
                                
 MARKETS NEWS	
                                
 * Prospects for a credit downgrade in Spain, combined with 
upbeat U.S. economic data, led to a sharp downturn for the 
euro versus the U.S. dollar on Wednesday, while Wall Street 
shed gains in a late sell-off. [ID:nN15165230]	
                                
 * Japan's Nikkei was flat on Thursday as optimism after 
the dollar hit a near three-month high against the yen the 
previous day was offset by worries over euro zone debt and 
overheating in the market. [ID:nTOE6BE06N]	
                                
 * The euro found a steadier footing early in Asia on 
Thursday but was vulnerable to further declines with European 
Union leaders seen unlikely to come up with a common solution 
to tackle the region's  sovereign debt crisis at a two-day 
summit.    	
                                
 	
                                
 (GMT) DATA/EVENTS	
                                
 0858 EZ Markit mfg PMI            Dec   
                                
 1000 EZ Inflation-f               Nov   
                                
 1330 U.S. Initial Claims          Weekly 
                                
 1330 U.S. International trade mm  Q3    
                                
 1330 U.S. House starts mm: change Nov   
                                
 1500 U.S. Philly Fed index        Dec   
                                
 1530 U.S EIA natural gas stocks   Weekly 
                                
 2200 U.S. Semi Book/Bill          Nov   
                                
 :: EZ Start of two-day EU leaders summit in Brussels	
                                
 	
	
 (Reporting by Rebekah Kebede; Editing by Ed Lane)