* Coming up: U.S. API weekly oil stock data at 2030 GMT
* U.S. data expected to show rise in crude, fuel inventories
* Strong dollar also helping depress oil
* For a technical view on crude prices, see: []
(Updates prices, detail, comment)
By Christopher Johnson
LONDON, May 4 (Reuters) - U.S. crude oil fell more than $1
to around $85 a barrel on Tuesday, retreating from 19-month
highs, depressed by an expected rise in U.S. crude and fuel
stocks and a stronger dollar.
U.S. crude inventories probably rose last week as a deep
discount for prompt U.S. crude oil widened the contango
structure of the futures curve, spurring refiners to import more
for storage, a preliminary Reuters poll showed. []
The dollar reached an eight-and-a-half month high against
the yen and a one-year peak versus the euro after robust data
that suggested the Federal Reserve will lead its counterparts in
Europe and Japan in raising interest rates this year. []
U.S. crude for June <CLc1> fell $1.10 to $85.09 by 1023 GMT,
after hitting an intraday high of $87.15 on Monday, the
strongest front-month price since $89.82 traded on Oct. 9, 2008.
Brent crude <LCOc1> slipped $1.07 to $87.87, maintaining a
big premium over U.S. crude futures, also known as WTI.
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For a technical chart on crude prices, click:
http://graphics.thomsonreuters.com/gfx/WT_20100405084512.jpg
For a graphic on dollar/oil correlation, click
http://graphics.thomsonreuters.com/gfx/RSW_20100405150342.jpg
For a chart showing Brent premium over U.S. crude, click
http://link.reuters.com/qap52k
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SLICK
Dealers said oil prices received some support from worries
that the giant slick in the Gulf of Mexico could disrupt crude
oil supplies in the United States.
This strength was particularly clear at the back end of the
curve where U.S. crude futures for five years ahead <CLc61> have
widened their premium over front-month futures to around $12
from under $5 a month ago.
BP <BP.L> said on Tuesday work had begun to drill a relief
well to stop the spill. []
"The possibility of supply disruptions, when combined with
the strong-looking chart formations, will likely make the case
for somewhat higher prices over the short-term," said Edward
Meir, senior oil analyst at brokers MF Global.
Ahead of weekly inventory data from industry group, the
American Petroleum Institute (API), and the U.S. government
Energy Information Administration (EIA), analysts forecast crude
stocks increased by 1.2 million barrels last week. []
If so, U.S. crude stocks -- at their highest level since
mid-June 2009 -- would have risen for the 13th time in 14 weeks,
and could in some way ease concerns over a possible supply
squeeze if the busted well gushing oil is not contained quickly.
Distillate stocks, including heating oil and diesel, were
forecast up 1.8 million barrels, for the fifth-straight week of
a build, while gasoline was seen rising just 200,000 barrels
after a surprise drawdown the week before, the poll showed.
The dollar rose 0.5 percent against a basket of currencies
<.DXY>, boosted by data on Monday showing U.S. manufacturing
posted its fastest pace of growth in nearly six years in April.
A strong U.S. currency makes dollar-denominated commodities,
such as oil, costlier for holders of other currencies.
(Additional reporting by Judy Hua in Singapore; editing by
Michael Hogan)
