SINGAPORE, March 10 (Reuters) - Oil rose around 0.4 percent
on Thursday with U.S. crude near $105 and Brent above $116 a
barrel, after forces loyal to Libyan leader Muammar Gaddafi
bombed oil industry infrastructure, inflicting what could be
longer-term damage on the country's exporting capacity.
Gaddafi's forces struck an oil pipeline leading to the Es
Sider town and dropped bombs on storage tanks in the Ras Lanuf
oil terminal area in the eastern section of Libya that is
rebel-controlled. Rebels said government forces also hit an oil
pipeline leading to Sidrah.
U.S. crude for April gained 36 cents to $104.74 a barrel at
0111 GMT, having surged to a 2-1/2-year peak of almost $107
earlier this week.
That caused the discount of WTI to European marker Brent to
widen to almost $12 a barrel from about $8 the previous day.
Brent on Thursday rose 36 cents to $116.30.
U.S. prices on Wednesday fell after crude stockpiles at the
pricing point for benchmark West Texas Intermediate at Cushing,
Oklahoma surged 1.7 million barrels to a record of almost 40.3
million barrels, according to the U.S. Energy Information
Administration.
FUNDAMENTALS
* Total U.S. crude inventories rose 2.51 million barrels
last week, the EIA said, dwarfing the forecast for an increase
of just 400,000 barrels in a Reuters poll. The weekly inventory
data also showed drawdowns for gasoline and distillates were
bigger than expected, reflecting improving demand.
* Confirming previous non-Libyan estimates, Shokri Ghanem,
chairman of Libya's National Oil Corp, told a news conference in
Tripoli that production has been cut to about half a million
barrels per day, from 1.6 million bpd, as many foreign and local
workers have left oil fields.
* Libyan oil trade has been paralyzed as banks decline to
clear payments in dollars due to U.S. sanctions, though Austrian
energy group OMV said it had been buying small amounts of Libyan
crude oil and would continue to do so.
* A Libyan insurgent said rebels had retaken the heart of
the closest city to the capital from forces loyal to Muammar
Gaddafi on Wednesday evening in some of the fiercest fighting in
almost three weeks of clashes.
* An OPEC delegate said on Wednesday that the group saw no
need for an emergency meeting to discuss raising output.
* Saudi Shi'ites staged another small protest in the
kingdom's Eastern province, defying a ban on demonstrations, but
Foreign Minister Prince Saud al-Faisal said dialogue, not
protest, was the best way to bring about change.
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MARKETS NEWS
* Asian shares edged lower on Thursday, weighed down by
worries that a surge in oil prices could exacerbate inflation
pressures in the region and cripple economic growth.
* The euro steadied on Thursday off a one-week low, although
its yield advantage, the main driver of its rally so far this
year, is increasingly undermined by worries about how Europe
will mend fiscal problems of several euro zone countries as the
market looks to a European policy makers' meeting and stress
tests on banks planned in the coming weeks.
DATA/EVENTS (GMT)
* The following data is expected on Thursday:
0745 France Industrial output mm Jan 2011
0900 Italy Industrial output yy WDA Jan 2011
1200 Britain BoE rate decision Mar 2011 1330
U.S. Unemployment claims Weekly 1330 U.S.
International trade Jan 1330 U.S. USDA export sales
Weekly 1330 U.S. USDA crop production March
1330 U.S. USDA world ag supply/demand March 1330
U.S. USDA Beef, pork output March China Exports yy
Feb 2011 China Imports yy Feb 2011
China Trade balance Feb 2011 1530 U.S. EIA
Natural Gas stocks Weekly
(Reporting by Alejandro Barbajosa; Editing by Ed Lane)
