* Some Egyptian ports in western Egypt affected by protests
* Technicals-U.S. crude headed for $94 this
week
* Coming Up: U.S. EIA weekly inventory report; 1530 GMT
(Adds comments from Breakingviews columnist, updates prices)
By Alejandro Barbajosa
SINGAPORE, Feb 2 (Reuters) - Oil was steady on Wednesday,
with Brent close to a 28-month high, on concerns that
anti-government protests in Egypt would trigger a wave of regime
change in the Middle East and North Africa, source of more than
a third of the world's oil.
Egyptian President Hosni Mubarak said on Tuesday he would
surrender power in September, angering protesters who want an
immediate end to his 30-year-rule.
ICE Brent for March shed 33 cents to $101.41 a
barrel at 0602 GMT, after touching $102.08 on Tuesday, the
highest price for a front-month contract since September 2008.
U.S. crude fell 30 cents to $90.47.
"With geopolitical tensions in Egypt remaining unresolved,
price risks remain skewed to the upside," said Credit Suisse
analysts including Stefan Graber. "We expect oil prices to ease
once tensions fade due to ample global inventories."
Mubarak's departure would reconfigure the politics of the
Middle East, with implications from Israel to oil giant Saudi
Arabia. King Abdullah of Jordan replaced his prime minister on
Tuesday after protests. Yemen and Sudan have also seen unrest,
after Tunisia's president was overthrown by demonstrations last
month.
And although the unrest in Egypt has so far had no effect on
transit through the Suez Canal or the Suez-Mediterranean (SUMED)
oil pipeline, shipping sources said there were major disruptions
in Egypt's Alexandria and Damietta ports due to staff shortages
and an absence of customs officials.
Egypt controls the canal and the pipeline, which together
moved over 2 million barrels per day (bpd) of crude and oil
products in 2009.
The International Energy Agency said the oil market does not
face any emergency, but called on OPEC to remain "flexible" in
the event unrest affects supply.
The Organization of the Petroleum Exporting Countries has
refrained from boosting production and sees no supply shortage.
OPEC member Libya's top oil official told Reuters the group
does not need to meet to discuss oil policy in February because
the market is well supplied and $100-per-barrel prices are
justified.
What really worries traders is that unrest in Tunisia and
Egypt could fuel similar protests in bigger oil producers such
as Libya -- or even Saudi Arabia, according to Christopher
Swann, a Reuters Breakingviews columnist.
This would create massive uncertainty over oil supplies --
though even the most extreme Islamic governments remain happy to
profit from oil sales, Swann writes.
U.S. crude oil stocks rose a greater-than-expected 3.8
million barrels last week, the API said on Tuesday, while
inventories at Cushing climbed 667,000 barrels.
Brent's premium to U.S. benchmark West Texas Intermediate
futures jumped to about $11 a barrel from $8.50 on Tuesday after
the American Petroleum Institute reported an increase in crude
stockpiles at the Cushing, Oklahoma delivery point for WTI.
Gasoline stocks also rose more than expected, by 3.9 million
barrels, while distillate stocks, which include heating oil and
diesel fuel, fell 1.1 million barrels, the API said.
Government statistics on inventories and demand from the
Energy Information Administration will follow on Wednesday at
1530 GMT.
Ahead of the API report, a Reuters analyst survey forecast
crude stocks to be up 2.7 million barrels, with distillate
stocks slipping 700,000 barrels and gasoline inventories rising
1.9 million barrels.
(Editing by Himani Sarkar)
