(Adds comments by the UAE, updates prices)
By Fayen Wong
PERTH, May 26 (Reuters) - Oil rose towards $133 a barrel on
Monday, extending the previous session's gains on a supply
outage at the Statfjord oilfield in the North Sea and a weak
U.S. dollar.
U.S. light crude for July delivery <CLc1> rose 40 cents to
$132.59 a barrel by 0229 GMT, extending Friday's gains of
$1.38. It struck a record high of $135.09 in intraday trade
last week.
London Brent crude <LCOc1> rose 33 cents to $131.90.
"The market is continuing to focus on supply side concerns
and the outage at Statfjord field is an issue," said Gerard
Burg, a commodities analyst at the National Australian Bank.
An oil spill at Statfjord shut about 138,000 barrels per
day of production on Saturday and triggered the evacuation of
workers, operator StatoilHydro said.
StatoilHydro said on Sunday the oil spill had been cleaned
up, all workers had returned to the platform and preparations
were under way to restart production. []
Longer-term worries that supply will struggle to keep up
with demand over the next few years also continue to support
prices.
OPEC Secretary-General Abdullah al-Badri said on Friday he
was not worried about reports of faster-than-expected depletion
in the world's biggest oil fields and repeated his position
that runaway oil prices were caused by speculation and not by
supply problems. []
A Reuters survey last week showed that non-OPEC production
had stagnated and would remain below 50 million barrels per day
this year. []
Other OPEC member the United Arab Emirates said on Sunday
it was ready to boost oil output if necessary.
"We are always happy to put more oil in the market if the
market needs more," UAE Oil Minister Mohammed al-Hamli told
Reuters when asked if UAE would raise supply with the Saudis.
Hamli declined to say if the UAE planned to boost output in
June. []
Analysts said continued weakness in the U.S. dollar, which
eased towards one-month lows against a basket of major
currencies on Monday, was helping support oil's rise.
Oil prices have climbed by around a third since the start
of the year as investors seeking a hedge against inflation and
the falling U.S. dollar pile into commodities.
Concern that record oil prices could dent global demand was
the key downside risk.
European Central Bank President Jean-Claude Trichet said
the potential economic fallout from financial market turmoil,
along with rising food and commodity prices, could shock the
economy further, while Vice President Lucas Papademos said
inflation pressures had intensified due to rising oil prices,
which were also dampening growth [] [].
In the U.S., data released on Friday showed that highway
miles driven in March fell 4.3 percent from a year earlier, the
first time this has happened in March since the last major oil
shock in 1979.
Road travel during the Memorial Day holiday over the
weekend was expected to be 1 percent lower than last year, the
first such decline since 2002.
(Reporting by Fayen Wong; Editing by Michael Urquhart)
