(Recasts, update prices)
By Ikuko Kao
LONDON, April 14 (Reuters) - Oil prices jumped on Monday
because of a U.S. pipeline shutdown and some production losses
in Nigeria following a fire at a flow station.
U.S. crude oil futures <CLc1> rose 71 cents to $110.84 a
barrel by 1250 GMT, after dropping to as low as $109.56.
Prices hit a record high of $112.21 a barrel last Wednesday
after a big fall in U.S. oil inventories. []
London Brent <LCOc1> crude rose 48 cents to $109.23.
The Capline crude oil pipeline, which brings crude from the
Gulf of Mexico to the U.S. Midwest, remained shut on Sunday
afternoon as work continued to repair a leak, operator Shell Oil
Co. U.S. unit of Royal Dutch Shell said.
It could not estimate when the 667-mile (1,073 kilometre)
line would return to service. []
Eni's <ENI.MI> Beniboye oil flow station in Nigeria has been
losing 5,000 barrels of oil per day due to a fire that broke out
during the night between April 12 and 13 after sabotage, the
Italian energy firm said on Monday. []
"The market is happy to trade higher," a broker said.
The dollar weakenend on Monday, reversing its initial gains
earlier in the day, pushing up oil prices, some analysts said.
"WTI continues to be tightly correlated to the movements of
the dollar index," Petromatrix said in a research note.
The recent weakness of the U.S. currency has prompted
investors to shift money from dollar assets to commodities
markets, partly contributing oil's rally to new peaks.
During Asian and London trading, oil was mostly pressured
down as weaker stock markets underlined economic gloom and the
expectation of falling energy demand.
On Saturday, OPEC's head of petroleum market analysis told
the International Monetary Fund's steering committee that global
demand appeared to be softening, and that high oil prices in
recent months were due more to financial market developments
than fundamental growth in demand.
"While financial market dynamics have been a contributing
factor to record high prices, oil market fundamentals point to a
market which is currently well supplied and the balance is
expected to soften further due to lower seasonal demand in the
coming months," Mohammad Alipour-Jeddi said in a statement.
His comments were set against growing signs of economic
slowdown in the United States and after the International Energy
Agency lowered its oil demand forecasts on Friday.
U.S. consumer confidence fell to its lowest in more than a
quarter century, a survey showed late last week.
Speculators in the crude oil market increased their net long
positions in U.S. crude in the week to April 8, according to
regulatory data released on Friday.
(Additional reporting by Jonathan Leff in Singapore; editing by
James Jukwey)
