* Weak euro weighs on crude oil
* OPEC, EIA raise demand growth forecast, support crude
* U.S. crude, gasoline, distillates stockpiles rose -poll
* Coming Up: U.S. API inventory report; 2030 GMT
(Recasts, updates prices, market activity to settlement)
By Robert Gibbons
NEW YORK, May 11 (Reuters) - U.S. crude oil futures fell on
Tuesday in a seesaw session, as traders remained cautious about
the $1 trillion rescue package aimed at stabilizing the euro
and keeping Greece's debt problems from spreading.
Expectations that U.S. oil inventories rose last week also
pressured prices, as did high stockpiles at the Cushing,
Oklahoma, delivery point for U.S. benchmark crude.
"Certainly worries about Greece and Europe have not gone
away. Also, concern about China inflation and the potential for
further tightening. High Cushing crude stocks and expectations
for additional supply builds provided some pressure and the
stock market also was unable to sustain gains," said Tom Bentz,
analyst at BNP Paribas Commodity Futures Inc in New York.
Crude oil futures bounced off early lows and rose intraday,
lifted by stronger refined products futures, higher demand
growth forecasts by OPEC and the U.S. government and data
showing continued rising oil demand in China.
Commodities and stock markets had rallied on Monday on the
rescue package aimed at stabilizing the euro and keeping
Greece's debt problems from spreading.
The euro fell on Tuesday as concerns about the euro zone
overcame the initial euphoria that followed announcement of the
rescue package. []
Global stocks slumped on Tuesday [] and U.S.
stocks seesawed but the major indexes finished the session
lower.
U.S. crude for delivery in June <CLc1> fell 43 cents to
settle at $76.37 a barrel, having seesawed between an early
$75.36 low and a high of $77.68.
ICE Brent for June <LCOc1> crude held on to its gain and
rose 37 cents to settle at $80.49 a barrel.
China's inflation edged up to an 18-month high in April and
bank lending topped expectations, which may curb oil prices if
potential monetary tightening measures result in lower demand
for fuel. [] []
But China's apparent oil demand in grew by double digits
for the eighth consecutive month in April.
Implied oil demand, the total amount of crude processed and
net imports of refined fuel, jumped in April nearly 13 percent
from a year earlier, according to Reuters calculations based on
preliminary official data. []
"While people say China will tighten policies, they
continue to buy more oil, copper, steel and that's positive for
the oil market," said Mark Waggoner, president at Excel Futures
in Bend, Oregon.
The Organization of the Petroleum Exporting Countries
raised its 2010 world oil demand growth forecast but said
non-OPEC supplies would rise more than previously expected,
while member compliance with production targets fell to 51
percent. []
The U.S. Energy Information Administration also raised its
2010 world oil demand growth forecast from its previous
estimate. [] The EIA also lifted its forecast for
non-OPEC crude oil production growth in 2010. []
U.S. gasoline <RBc1> and heating oil <HOc1> futures settled
about 1 percent higher on Tuesday, with traders citing support
from news of a refinery snag and expected demand as the U.S.
summer driving season approaches.
Also supportive was news that U.S. retail gasoline demand
rose 1.4 percent in the week to May 7 from the previous week,
according to MasterCard SpendingPulse data. []
VOLATILITY
On Monday oil prices rose as much as $3.40, before settling
up $1.69 at $76.80. Intraday volatility was expected to
continue in coming days as the full implications of the euro
zone rescue package are gauged.
Spot gold, often seen as a safe-haven, vaulted 2.5 percent
to a record high, highlighting the doubts many investors have
over the rescue plan. []
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic on oil, equities and gold, click here:
http://graphics.thomsonreuters.com/gfx/JBO_20101105091337.jpg
For a commodity performance graphic, click here:
http://graphics.thomsonreuters.com/10/CMD_PRFG0510.html
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Crude oil intraday on Tuesday disengaged from its recent
tight correlation to the dollar and equities markets.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic on oil/S&P 500 index/dollar correlation,
click here:
http://graphics.thomsonreuters.com/gfx/JLeff_20101105114856.jpg
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
The oil market's focus will turn to weekly U.S. inventory
statistics to be published over the next two days.
U.S. crude inventories likely rose by 1.3 million barrels
last week on higher imports, a Reuters poll of analysts showed
on Tuesday. []
Supplies of distillates including heating oil and diesel
were expected to be up 1.3 million barrels, while gasoline
stocks rose 700,000 barrels, the poll showed.
The industry group American Petroleum Institute will
release its inventory report for the week to May 7 on Tuesday
at 4:30 p.m. EDT (2030 GMT). The U.S. Energy Information
Administration's weekly report is set to arrive on Wednesday
morning at 10:30 a.m. EDT (1430 GMT).
(Additional reporting by Gene Ramos in New York, Joe Brock in
London and Alejandro Barbajosa in Singapore; Editing by David
Gregorio)
