* Chinese crude imports fall below 4 million bpd in October
* Dollar index <.DXY> rises for fourth consecutive day
* API says U.S. crude inventories fall 7.4 million barrels
* Coming Up: U.S. EIA oil inventory report at 1530 GMT
(Updates detail, comment, prices)
By Christopher Johnson
LONDON, Nov 10 (Reuters) - Oil climbed to around $87 per
barrel on Wednesday as news of a big drop in U.S. crude oil
inventories outweighed the impact of a stronger dollar and a
fall in Chinese oil imports.
The American Petroleum Institute (API) said late on Tuesday
that U.S. crude stockpiles dropped a surprise 7.4 million
barrels last week, defying expectations of a 1.4 million-barrel
build. []
Markets awaited confirmation of the figures from the U.S.
Energy Information Administration, set to release government
data on inventories and demand on Wednesday at 1530 GMT.
The impact of the rise in U.S. stocks was blunted by a rise
in the value of the dollar, which gained about 0.4 percent
against a basket of currencies <.DXY>, reducing the appeal of
commodities as an investment. []
U.S. crude futures for December <CLc1> rose 40 cents to
$87.12 by 1430 GMT, after reaching $87.63 on Tuesday, its
highest since October 2008. ICE Brent <LCOc1> rose 30 cents to
$88.63 per barrel.
"The API crude data is supportive for oil and significant
because the figures add up," said Christophe Barret, global oil
analyst at Credit Agricole in London.
"Crude stocks dropped because U.S. imports fell and refinery
runs increased to take advantage of a shortage of products in
Europe during the French refinery strikes. But the strikes are
over now, so it is only a temporary support for prices."
CHINA
Data showing a substantial fall in Chinese crude imports in
October weighed a little on oil.
China's crude imports fell 30 percent in October to 16.39
million tonnes, the lowest in at least 18 months, from a record
in September, customs data showed on Wednesday. []
Analysts warned against reading too much into a single set
of trade data from China, the world's second-largest oil user.
The average of Chinese crude imports for September and
October, at 19.84 million tonnes, is roughly in line with
averages seen for the first eight months of the year at 19.73
million, suggesting re-stocking took place in the month before
October's week-long National Day celebrations.
Oil prices have dipped slightly so far this week, but gained
more than 7 percent last week and technical analysts said charts
showed little sign of an immediate downward correction.
Clive Lambert, analyst at FuturesTechs, said he was "not too
concerned" about the sustainability of the move upwards because
of a strong band of support below current prices.
The International Energy Agency, which advises 28
industrialised countries, has raised its oil price forecasts,
citing growing supply uncertainty and looking towards prices at
over $200 per barrel by 2035.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic illustrating a band of possible technical
price support lines, click: http://link.reuters.com/meg74q
For a graphic of the IEA's oil price assumptions, click:
http://r.reuters.com/hyn54q
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Tuesday's API industry report pointed to tightening fuel
supplies in the United States. Stockpiles of distillates,
including heating oil and diesel, dropped by 4 million barrels
in the week to Nov. 5, while gasoline inventories slipped 3.4
million barrels.
U.S. crude inventories were forecast to have increased by
1.4 million barrels last week, a Reuters survey showed, while
stocks of distillates including heating oil and diesel were
expected to have fallen 1.9 million barrels. Gasoline stockpiles
were forecast to have dropped 800,000 barrels. []
The EIA raised its 2011 world oil demand forecast by 33,000
barrels per day, to 87.77 million bpd, from its previous monthly
forecast, and now sees a year-on-year rise of 1.44 million bpd.
[]
(Additional reporting by Alejandro Barbajosa in Singapore;
editing by Keiron Henderson)
