(Recasts with U.S. inventory data, updates prices)
By Jane Merriman
LONDON, Feb 21 (Reuters) - Oil fell back on Thursday from
all-time highs above $100 a barrel, pressured partly by a
bigger-than-expected rise in crude oil stocks last week in top
energy consumer the United States.
But the market remains supported by a tide of investor cash,
which helped drive oil to a new record on Wednesday.
U.S. crude oil inventories rose a surprise 4.2 million
barrels last week, a government report said, more than the 2.3
million increase forecast by analysts. []
Oil has averaged $93.02 a barrel this year, up nearly a
third on the average in 2007 of $72.30.
U.S. crude for April delivery <CLc1> was down 20 cents at
$99.50 a barrel by 1612 GMT.
The March contract, which expired on Wednesday, hit a record
of $101.32, before closing at $100.74 a barrel.
Oil's latest spurt has taken it close to its all-time
inflation-adjusted high of $102.53 hit in April 1980, a year
after the Iranian revolution.
London Brent <LCOc1> was down 32 cents at $98.10 a barrel.
"Overall, the (U.S. inventory) numbers have a bearish tilt,"
said Chris Jarvis, senior analyst at Caprock Risk Management.
He said the bigger-than-expected build in crude oil stocks
increased the emphasis on a possible OPEC production cut at the
group's March meeting.
"Without production cuts, we believe the current oil price
is not sustainable over the near-term given the fundamental
picture today," Jarvis said.
Gasoline stocks rose by 1.1 million barrels, in line with
forecasts. Distillates fell by 4.5 million barrels, more than
the predicted 1.7 million barrel decrease.
Analysts have pointed to rising U.S. crude oil stocks as
evidence that market's supply/demand balance is not constrained.
Members of the Organization of the Petroleum Exporting
Countries have repeatedly said there is no need for more oil.
"We will not just react to $100 oil," Qatar Oil Minister
Abdullah al-Attiyah told Reuters. Qatar sees demand for oil
falling seasonally in the second quarter as the winter ends and
customers are requesting less oil in March, not more, he said.
But the International Energy Agency, which advises
industrialised countries on energy matters, has urged OPEC to,
at the very least, keep oil production levels unchanged, to
rebuild low crude stocks.
Economic data on the United States have painted a gloomy
picture for oil demand in the world's top energy consumer, but
investors' focus has shifted for now to the inflation outlook.
The U.S. Consumer Price Index, for example, rose faster than
expected in January and for the second straight month.
Funds have piled into oil and commodities to protect their
returns against inflation and because of the weak dollar.
Gold, copper and soybeans, for example, have all touched
record highs.
"The current run could continue for a little while longer
given the general infatuation with commodities," said Edward
Meir, analyst at broker MF Global.
(Additional reporting by Chua Baizhen, editing by Anthony
Barker)
