(Corrects time of EIA stock data to 1430 GMT)
* Cushing crude stocks hit fresh record high
* Worries over tighter financial regulation in U.S., Europe
* Coming up: U.S. EIA crude, dist, gasoline stocks; 1430
GMT
* For a technical view, click: []
(Updates prices)
By Florence Tan
SINGAPORE, May 19 (Reuters) - U.S. crude dropped near $68
after falling to a seven-month low on Wednesday, extending
losses for the third session this week, as Cushing stockpiles
scaled a new high while concerns over tighter financial
regulation in the U.S. and Europe hit global equities and most
commodities.
Germany's move to ban naked short-selling in shares of ten
key financial institutions and new rules from the U.S.
Securities and Exchange Commission and stock exchanges to curb
trading when markets plunge increased uncertainty in the
financial markets, dampening investor appetite for riskier
assets. [].
U.S. crude <CLc1> for June delivery fell as low as $67.90,
its lowest intraday level since Sept. 30, 2009. By 0643 GMT,
the contract was down $1.29 at $68.12 a barrel.
London Brent crude <LCOc1> was down 84 cents at $73.59 a
barrel after hitting a three-month low. Brent crude fell as low
as $73.21, down $1.22 a barrel by 0049 GMT, its lowest since
$72.55 hit on Feb. 16.
The fall in oil prices was purely based on economic
concerns in Europe, said Jonathan Barratt, managing director at
Commodity Broking Services in Sydney.
Investors moved into safe havens such as the dollar and the
yen on fears tighter financial regulation would derail the
global economic recovery.
The euro <EUR=> fell to a fresh four-year low on Wednesday
while the dollar index, which tracks the U.S. unit's
performance against a basket of major currencies, rose to a
14-month high of 87.458 <.DXY> before slipping back to 87.179.
A stronger dollar makes oil more expensive for holders of many
other currencies.
"The (oil) market is getting too far ahead of itself,"
Barratt said. "The current financial issues will be looked at
and solved and we'll get back to solid fundamentals which
suggest growth."
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a technical chart, see:
http://graphics.thomsonreuters.com/gfx/WT_20101905090410.jpg
For a chart on oil/dollar correlation returns with Europe
risk, click:
http://graphics.thomsonreuters.com/gfx/RSW_20101905125817.jpg
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Crude oil inventories at the key storage hub at Cushing,
Oklahoma, rose 914,000 barrels last week to a fresh record high
of 37.99 million barrels, data from industry group the American
Petroleum Institute (API) showed on Tuesday. []
However, the overall U.S. crude stockpiles fell
unexpectedly last week while gasoline stocks rose.
"Refinery rates are high again. Crude oil stocks have to be
bought so that they can refine it," Barratt said. "It's
gasoline season; we're getting into the busiest time of the
year."
U.S. refinery utilisation rose by 1 percentage point to
85.9 percent of capacity last week, API data showed. This
caused crude inventories to fall by 794,000 barrels in the week
to May 14, API data showed, versus analyst expectations of a
700,000-barrel rise in the latest Reuters poll.
Gasoline stocks rose unexpectedly, by 981,000 barrels last
week, versus an expected fall of 600,000 barrels, according to
the average analyst estimate.
Distillates, including heating oil and diesel, fell 331,000
barrels, versus expectations of a 1.3 million barrel rise.
The market is expecting another set of data from the U.S.
Energy Information Administration which is set to arrive on
Wednesday at 1430 GMT.
(Additional reporting by Erwin Seba in HOUSTON and Osamu
Tsukimori in TOKYO; Editing by Ed Lane)
(florence.tan@thomsonreuters.com; + 65 6870 3497; Reuters
messaging: florence.tan.thomsonreuters.com@reuters.net))
