* Weak euro weighs on crude oil, dampens risk sentiment
* OPEC, EIA raise demand growth forecast, support crude
* API data: crude stocks up less than exptecte
* Coming Up: U.S. EIA inventory report, Wednesday morning
(Recasts, updates market activity, prices, adds API data)
By Gene Ramos
NEW YORK, May 11 (Reuters) - U.S. crude oil futures fell on
Tuesday on risk aversion amid doubts that the $1 trillion
rescue package aimed at stabilizing the euro would work to keep
Greece's debt problems from spreading.
Prices stayed down more than 1 percent after the American
Petroleum Institute reported that stockpiles at the Cushing,
Oklahoma, delivery point for U.S. benchmark crude, rose again
last week to another record, at 37.1 million barrels.
The API data, released after the floor settlement, also
showed U.S. crude stockpiles rose far less than expected last
week while gasoline supplies fell, when analysts had expected
an increase.
U.S. crude for delivery in June <CLc1> was down 81 cents at
$75.99 a barrel at 5 p.m. EDT (1700 GMT). Earlier, it settled
down 43 cents at $76.37 a barrel, after trading from $75.36 to
$77.68.
ICE Brent crude for June <LCOc1> was up 10 cents at $80.22
a barrel. It had settled up 37 cents at $80.49.
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.
Weakness was focused at the front-end of the U.S. futures
curve, with the premium of July to June contract widening from
$3.29 a barrel on Monday to $3.93 in late Tuesday trade, while
the discount of U.S. futures to Brent widened $1.00 to $4.32 a
barrel. Rising inventories at the Cushing delivery point for
the New York Mercantile Exchange's futures contract, have
weighed on front-month futures over recent weeks.
"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.
The API said that for the week to May 7, crude stocks rose
362,000 barrels, gasoline stocks were down 906,000 barrels and
distillates, which including heating oil and diesel fuel, edged
up 94,000 barrels. Stocks at the Cushing storage were up
783,000 barrels. []
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, while global. []
Global stocks slumped on Tuesday [] and on Wall
Street was mostly lower in volatile trade on fears the massive
bailout for the euro zone won't solve the region's deep-seated
problems. []
Spot gold, often seen as a safe-haven for investors,
vaulted 2.5 percent to a record high, highlighting the doubts
many investors have over the rescue plan. []
China's inflation edged up to an 18-month high in Apriland
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. []
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 trimmed
gains after the API data. They had settled about 1 percent
higher, with traders citing 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. []
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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
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Crude oil intraday on Tuesday disengaged from its recent
tight correlation to the dollar and equities markets.
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For a graphic on oil/S&P 500 index/dollar correlation,
click here:
http://graphics.thomsonreuters.com/gfx/JLeff_20101105114856.jpg
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(Additional reporting by Robert Gibbons in New York, Joe
Brock in London and Alejandro Barbajosa in Singapore; Editing
by David Gregorio)
