* Euro falls to 14-month low against the dollar
* U.S. crude stockpiles at Cushing at record high
* Coming up: CFTC commitments data at 3:30 p.m. EDT Friday
(Recasts, updates throughout, changes byline and moves
dateline from previous LONDON)
By Robert Gibbons
NEW YORK, May 14 (Reuters) - U.S. crude oil fell more than
3 percent to a three-month low below $72 a barrel on Friday, on
concerns the European debt crisis could curb energy demand
growth with U.S. crude inventories already swollen.
The euro lost more ground to trade below $1.24 as European
Central Bank policymaker Axel Weber said dangers still lurk in
the financial system and should not be underestimated. For
more, see []
U.S. stocks also tumbled on the euro-zone debt concerns,
while Visa and MasterCard led the financial sector lower after
the U.S. Senate backed limits on card fees. []
"Crude futures are down as people are realizing that the
euro zone debt troubles may not only be regional in scope but
global as well and that could harm world economic growth," said
Rich Ilczyszyn, senior market strategist at Lind-Waldock in
Chicago.
U.S. crude for June delivery <CLc1> fell $3.05, or 4.1
percent, to $71.35 a barrel by 12:30 p.m. EDT (1630 GMT), after
falling as low as $71.05. the lowest price for a front-month
contract since prices fell to $70.77 on Feb. 8.
Prices briefly pared losses after U.S. retail sales and
industrial output for April rose more than expected, but then
resumed their decline. []
ICE Brent June futures <LCOc1> were down $2.79 at $77.32 a
barrel on the day the contract expires.
Stockpiles of crude at Cushing, Oklahoma, the delivery hub
for the U.S. contract's benchmark crude, have risen the last
eight weeks to a record 37 million barrels, pushing front-month
U.S. crude down relative to both more distant futures contracts
and the alternative global crude benchmark, Brent.
The spread between front-month U.S. crude prices and
longer-dated futures <CL-1=R>, known as the contango, was the
widest it has been in nearly 15 months.
The U.S. benchmark West Texas Intermediate is also trading
close to the deepest discount to Brent since February 2009
<CL-LCO1=R>, although this narrowed slightly on Friday due to
the Brent June expiry.
"The specter of large crude oil inventories seems to be
weighing on markets much more than before, and has been
instrumental in pressuring prices, widening the contangos and
contributing to Brent's expanding premium over WTI," said
Edward Meir of MF Global.
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For a graphic of the WTI contango, click:
http://graphics.thomsonreuters.com/gfx/AB_20101405104110.jpg
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The International Energy Agency this week trimmed its 2010
global oil demand forecast by 50,000 barrels per day to 1.62
million bpd. It said the Greek debt crisis could dent oil
consumption if it spreads to other countries such as Spain,
Portugal and Italy. []
This contrasted with the raised 2010 demand growth
forecasts from the Organization of the Petroleum Exporting
Countries and U.S. Energy Information Administration.
[] []
On Monday, oil rose sharply following announcement of a
rescue package of almost $1 trillion, led by the European Union
and the International Monetary Fund for debt-laden European
economies.
During Monday's trading session oil was up more than $3
from the previous close at an intraday high of $78.51 a barrel
but the market has since reversed, falling in the three
subsequent sessions and now on track to fall for a fourth.
(Additional reporting by Gene Ramos in New York, Emma Farge in
London, Alejandro Barbajosa in Singapore; Editing by David
Gregorio)
