* U.S. exchange to tighten position limits enforcement
* U.S. inventory data from the API due at 2030 GMT
* Analysts see 2.7 mln barrel draw in U.S crude stocks
(Updates throughout, changes dateline from SINGAPORE)
By Catherine Bosley
LONDON, Sept 15 (Reuters) - Oil rose towards $69 a barrel on
Tuesday, lifted by a weaker dollar and an expected draw in U.S.
crude stocks, but concerns that a major U.S. exchange will
increase enforcement of position limits capped gains.
The CME Group <CME.O>, which runs NYMEX, has told traders
and brokers of tighter enforcement of existing position limits
on NYMEX, CME, and other exchanges as of Sept. 14, raising the
prospect of punishment for price manipulation. []
U.S. crude for October delivery <CLc1> rose 6 cents to
$68.92 a barrel by 0904 GMT, off an intra-day high of $69.23,
while Brent <LCOc1> lost 34 cents to $67.10. Trade in Brent was
distorted by the expiry of the front-month contract at close of
business on Tuesday.
"We're consolidating after last week," said VTB Capital
analyst Andrey Kryuchenkov, adding that crude oil was generally
taking its cue from the dollar and equities.
Some oil traders said they interpreted the advisory as a CME
warning that it could soon offer fewer exemptions for exceeding
position limits.
But a source told Reuters on Monday that the CME will not
boost enforcement of positions limits and that the advisory was
"routine." []
"There's a lot of talk about (the CME advisory),"
Kryuchenkov said. "There are jitters there. It comes on top of
the ongoing CFTC investigation and lawmakers pushing for tougher
regulation. It all piles up."
The U.S. Commodity Futures Trading Commission aims to rein
in speculation in energy and commodity trading, especially oil.
Excessive speculation has been blamed for sending crude on a run
to nearly $150 a barrel in 2008.
For more on the CFTC, see: []
Kryuchenkov said a trade dispute between the United States
and China, the world's first and second biggest fuel users, over
a U.S. decision to impose special duties on Chinese tyres was
having little effect on the market. []
DISTILLATES
Oil prices, which have risen from January's low of $32.70 to
a high for the year of $75 in August, could struggle to breach
the August high mark in coming weeks because of plentiful
inventories, analysts said.
The American Petroleum Institute (API) industry group will
release inventory data at 2030 GMT on Tuesday, while the U.S.
Energy Information Administration, a government agency, will
issue its own report on Wednesday.
A preliminary Reuters poll forecast a 2.7-million-barrel
draw in domestic crude stocks but a 1.5-million-barrel increase
in distillate supplies and an 800,000-barrel build in gasoline
stocks. []
"The most important thing here is obviously distillate
stocks. We expect a colder than usual winter in the U.S.,"
Kryuchenkov said. "We might have decent demand in distillates,
heating oil. Provided as well industrial demand picks up."
Distillates are used for heating oil and jet fuel.
Meanwhile, the dollar index, a measure of the U.S. unit
against six other major currencies, was a touch weaker, but
nevertheless off the one-year low of 76.457 points hit last
week.
Analysts said the dollar was likely to remain week against
the euro and the yen in coming months. A falling dollar makes
dollar-denominated commodities cheaper to holders of other
currencies.
(Additional reporting by Sambit Mohanty in Singapore; editing
by Anthony Barker)
