* U.S. crude stockpiles at Cushing at record highs
* Euro falls to 14-month low against the dollar
* Coming up: US retail sales, 1230 GMT; Ind output 1315 GMT
(Updates prices, adds details)
By Emma Farge
LONDON, May 14 (Reuters) - U.S. crude oil fell more than $1
to a three-month low near $73 a barrel on Friday, dragged down
by swollen U.S. crude inventories and concerns that the European
debt crisis will curb future energy demand growth.
Stockpiles of crude at Cushing, Oklahoma, the delivery hub
for the U.S. contract, have risen for the last eight weeks to a
record 37 million barrels, pushing front-month U.S. crude down
relative to both more distant futures contracts and the
alternative global crude benchmark, Brent.
U.S. crude for June delivery <CLc1> fell $1.25 to $73.15 a
barrel by 1115 GMT, after earlier falling to $72.72 -- the
lowest price for a front-month contract since Feb. 12.
ICE Brent June futures <LCOc1> also fell more than $1 on
Friday and were down $1.85 at $78.26 a barrel by the same time
on the day of expiry.
The spread between front-month U.S. crude prices and
longer-dated futures, known as the contango, is now near
15-month highs. The U.S. benchmark West Texas Intermediate (WTI)
is also trading close to the deepest discount to Brent since
February 2009.
"The spectre of large crude oil inventories seems to be
weighing on markets much more than before, and has been
instrumental in pressuring prices, widening the contangos and
contributing to Brent's expanding premium over WTI," said Edward
Meir of MF Global.
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For a graphic of the WTI contango, click:
http://graphics.thomsonreuters.com/gfx/AB_20101405104110.jpg
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Concerns that rigorous fiscal tightening in Europe following
the Greek debt crisis could imperil the still tentative economic
recovery also weighed on prices, analysts said.
The euro hit a 14-month low against the dollar on Friday
<EUR=>, dampening European buying interest for
dollar-denominated commodities such as oil. European shares were
down nearly 2 percent in early trade on Friday. []
"The European debt crisis has made us question the growth
outlook for the global economy and therefore fuel demand," said
Toby Hassall, an analyst at CWA Global Markets in Sydney.
Earlier this week, the International Energy Agency trimmed
its 2010 global oil demand forecast by 50,000 barrels per day
(bpd) to 1.62 million bpd.
It said the Greek debt crisis could dent oil consumption if
it spreads to other countries such as Spain, Portugal and Italy.
[]
But this contrasted with the Organisation of the Petroleum
Exporting Countries and U.S. government unit Energy Information
Administration which both raised their estimates for world oil
demand growth in 2010. [] []
On Monday, oil rose sharply following the announcement of a
rescue package of almost $1 trillion, led by the European Union
and the International Monetary Fund for debt-laden European
economies.
At one point in Monday's session oil was up more than $3
since the previous close at a high of $78.51 a barrel but the
market has since reversed, falling in the three subsequent
sessions and now on track to fall for a fourth.
The market will later look to U.S. economic indicators set
to be published on Friday, including industrial production and
retail sales for April in the world's top energy consumer.
(Additional reporting by Alejandro Barbajosa in Singapore;
editing by Keiron Henderson)
