* U.S. crude stocks at 16-year high-EIA
* Japan posts record drop in exports
(Updates prices at settlement, adds U.S. stock market)
By Edward McAllister
NEW YORK, March 25 (Reuters) - Oil fell more than $1 a barrel on
Wednesday as U.S. government data showed crude stocks were at their
highest since 1993.
The Energy Information Administration's weekly inventory report
showed a more-than-expected 3.3 million-barrel rise in U.S. crude
supplies, to 356.6 million barrels, for the week ending March 20.
[]
U.S. light crude for May delivery <CLc1> settled down $1.21 to
$52.77 per barrel. London Brent crude <LCOc1> settled down $1.75 at
$51.75
"Crude (stocks) still extremely high, distillates still
extremely high...so big picture, it's still overall not pretty,
inventory-wise," said Tom Bentz, senior commodity analyst at BNP
Paribas Commodity Futures in New York.
Oil has tumbled about $100 from highs above $147 last July as
the global economic crisis has dented energy demand worldwide.
In an attempt to stem the fall in prices, the Organization of
the Petroleum Exporting Countries has aimed to cut output by 4.2
million barrels from September levels.
An EIA report on Wednesday estimated that the producing group as
a whole reached a 67 percent compliance to the targeted cuts in
February. []
The biggest producer, Saudi Arabia, picked up the slack for
other less vigilant members, complying 100 percent to the cuts, the
EIA said.
Japan, the world's second-largest economy, posted a record drop
in February for exports -- down 49.4 percent -- as global demand for
Japanese cars and electronics evaporated. []
Crude oil import volumes to Japan fell 13.9 percent in February,
their lowest tally for the month in 20 years, preliminary data from
Japan's Ministry of Finance showed.
CAUTIOUS OPTIMISM
Analysts said an excess of crude supply on world markets would
not disappear soon, with little sign of demand picking up.
"We haven't seen a dramatic uptick in demand and until we see
that, there's going to be a trading range where the mid- to upper
50s is probably more of a sell signal and in the low forties a bit
of a buy signal. We're going to be rangebound here until we see some
real news on demand," said Mike Zarembski senior commodities analyst
at OptionsXpress in Chicago.
Wall Street added pressure to energy futures after it retreated
as technology shares fell after news IBM is planning layoffs and a
disappointing Treasury note auction raised concerns of flagging
foreign interest in U.S. government debt, which could bode poorly
for the economy. []
On Tuesday, President Barack Obama renewed calls for leading
economies to boost stimulus spending, repair credit markets and
extend aid to poor countries when Group of 20 leaders meet in London
on April 2. []
Speaking with cautious optimism on Wednesday, a Chinese central
bank adviser said China, the world's third-largest economy, was
showing signs of improvement. []
"Before (the economy) bottoms out, it has to bottom. I believe
it has bottomed, with the stimulus package and signs of recovery in
some industries," said Fan Gang, who sits on the Chinese central
bank's monetary policy advisory committee, in a Reuters interview in
Hong Kong.
(Additional reporting by Robert Gibbons and Gene Ramos in New York,
Christopher Baldwin in London; Editing by Marguerita Choy)
