* Brent lifted by rising euro zone business morale
* Dollar weakness supportive to oil, other commodities
* Ample U.S. crude stockpiles help curb U.S. oil prices
* Coming up: API oil data, 4:30 p.m. EST Tuesday
(Updates with CTFC positions data, paragraph 13)
By Robert Gibbons
NEW YORK, Jan 21 (Reuters) - Brent crude futures rose above
$97 a barrel on Friday as confidence in a European recovery
boosted the euro to a two-month peak against the dollar, while
U.S. oil ended a choppy session lower, stalling just above
$89.
ICE Brent's premium to U.S. benchmark West Texas
Intermediate crude <CL-LCO1=R> reached $8.59 intraday, its
highest since February 2009, boosted by strong emerging market
demand, tight North Sea crude supplies and a trading firm's
control of double-digit North Sea cargoes.
The oil complex was supported by news that German business
morale jumped in January to its highest level in 20 years,
according to the Munich-based Ifo economic institute. while
French data also showed rising confidence. []
The euro, also helped by Asian demand, rose to a two-month
high versus the dollar. []
U.S. crude oil prices slipped as the crude inventory rise
reported on Thursday, the first in seven weeks, had investors
concerned that more stock builds could be coming as deliveries
delayed because of year-end tax issues start to arrive.
[]
In London, ICE Brent crude for March <LCOc1> rose $1.02 to
settle at $97.60 a barrel, but lost 1.06 percent over the week.
Brent reached $99.20 intraday last Friday, as the February
crude contract expired.
U.S. crude oil for March delivery <CLc1> fell 48 cents to
settle at $89.11 a barrel, trading from $88.87 to $90.22. U.S.
crude posted a 2.65 percent loss for the week.
"A combined move with the weaker dollar and improving
business confidence in Germany is supporting oil. On Thursday,
we saw a very strong support point... We could see a test of
the upper level, which is $99.20 for Brent," said Thorbjorn Bak
Jensen, an analyst at A/S Global Risk Management Ltd.
U.S. gasoline <RBc1> and heating oil <HOc1> futures rose on
Friday, as a Houston refiner started a two-month overhaul of
its main gasoline making unit and on forecasts for colder
weather. []
The U.S. heating oil profit margin, or crack spread,
<CL-HO1=R> reached $22.54 a barrel, highest since Jan. 20,
2009, when the profit margin reached $25.42.
"As nearby crude futures maintain a weak undertone, the
heating oil crack spreads continue to stretch and the $23 a
barrel area would appear achievable by early next week," Jim
Ritterbusch, president at Ritterbusch & Associates in Galena,
Illinois, said in a note.
Ritterbusch pointed to the high U.S. stockpiles at the WTI
contract delivery point in Cushing, Oklahoma, "as the larger
inhibitor to upside crude price progress in the U.S."
Speculators reduced their net long positions in U.S. crude
in the week to Jan. 18, the Commodity Futures Trading
Commission said. The reduction left net longs 5.4 percent lower
from their all-time high hit the last week of December.
[]
U.S. crude prices had a sharp price retreat on Thursday as
the February contract expired, triggered by the government's
report of inventory builds and concerns China may take more
measures to cool stubborn inflation, resulting in slower growth
in oil demand.
The weak dollar on Friday also lifted dollar-denominated
copper and limited the losses of gold, which was pressured by a
firmer appetite for higher risk assets on expectations the
economy was recovering. [] []
BRENT/WTI
As the Brent/WTI spread soared to a near two-year high,
four North Sea Brent oil and gas platforms, which shut down on
Saturday, were expected to remain closed for several weeks,
platform operator Shell <RDSa.L> said. []
While shutting in significant natural gas production, but
only 20,000 barrels per day of crude oil output, the news
helped keep bullish sentiment for Brent intact.
Nigeria has raised the official selling price (OSP) for its
competing benchmark Bonny Light and Qua Iboe crude oil grades
in February to dated Brent plus $1.90 a barrel, up 15 cents
from January, a trade source said on Friday.
As the Brent/WTI soars, some analysts were cautioning about
the potential for a correction.
"The spread is starting to get rather stretched and when it
does get rather stretched there is usually a sharp correction
at some point," said Michael Hewson, a market analyst at CMC
markets.
(Additional reporting by Gene Ramos in New York and Jessica
Donati in London; Editing by Marguerita Choy)
