* EIA surprise crude stocks build pressures oil
* Weak dollar supports oil, pushes gold to record high
* Coming up: U.S. jobless claims data, 8:30 a.m. EDT Thurs
(Recasts, updates with settlement prices, market activity)
By Robert Gibbons
NEW YORK, Sept 22 (Reuters) - Oil prices slipped on
Wednesday after a government report showed a surprise rise in
U.S. oil stocks, offsetting earlier support stemming from
expectations that the Federal Reserve is prepared to pump
billions of dollars into the weak economy.
Crude inventories rose despite the shutdown of a major
pipeline that carries Canadian crude into the United States.
Analysts had expected the shutdown of the Enbridge line would
cause inventories to fall, and the unexpected build dragged
down oil prices, which have fallen in six of the last seven
sessions.
Combined U.S. commercial crude and refined products
inventories hit a record 1.144 billion barrels, the highest
level since the EIA began collecting weekly data in 1990.
[]
U.S. crude for November <CLc1> delivery fell 26 cents, or
0.35 percent, to settle at $74.71 per barrel, having traded
from $73.84 to $76. ICE Brent crude for November <LCOc1> fell
47 cents to settle at $77.95 a barrel.
The EIA inventory report said U.S. crude stocks rose
970,000 barrels in the week to Sept. 17, against a forecast for
stocks to be down 1.9 million barrels.
The report also showed gasoline stocks rose unexpectedly
and that distillate stocks increased slightly more than
forecast.
The EIA report followed industry data from the American
Petroleum Institute released late Tuesday, which painted a
similar picture.
"When the API data came out yesterday, a lot of people were
skeptical and wanted to wait for the DOE numbers but these
aren't bullish either," said Tom Bentz, broker at BNP Paribas
Commodity Futures Inc in New York.
"With the Enbridge outage last week, it is surprising to
see a build in inventories," Bentz added.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic on crude and oil product inventories:
http://link.reuters.com/tyb94p
Graphic on performance of oil and other commodities:
http://link.reuters.com/hun72k
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DOLLAR BROADLY WEAKER
Ahead of the inventory report, crude oil prices were lifted
more than $1 to $76 a barrel by the broadly weaker dollar.
The dollar's slide followed Federal Reserve comments
expressing greater concern about sluggish U.S. growth and low
levels of inflation in a statement that many investors took as
opening the door wider to pumping more dollars into the
economy. []
Expectations of further monetary easing sent the dollar
index <.DXY> to a six-month low and the greenback to a
five-month low against the euro. []
A weaker dollar can lift dollar-denominated oil prices
because it improves the purchasing power of consumers using
other currencies and lessens the value of greenbacks received
by producers.
"The weaker dollar reflects the Fed statement and I expect
more liquidity will be supportive for commodities," said
Christophe Barret, oil analyst at Credit Agricole in London.
Gold hit a record high for a fifth straight session and was
near $1,300 an ounce after the Fed said it was ready if needed
to add more stimulus and that inflation was running below where
it would like it to be. []
Also seen as supportive and helping limit crude oil losses
was the prospect of threatening tropical weather. The U.S.
National Hurricane Center on Wednesday raised to 60 percent the
chance that a tropical depression could form in the Caribbean
Sea over the next 48 hours. []
While most computer weather models continued to forecast
the system would hit Central America and miss Gulf of Mexico
energy operations, one computer model on Wednesday showed the
system might turn northwest toward the Gulf.
(Additional reporting by Selam Gebrekidan in New York, Joe
Brock in London and Alejandro Barbajosa in Singapore; Editing
by Lisa Shumaker)
