Oil falls as stock build eases supply worry

By Matthew Robinson

NEW YORK (Reuters) - Oil slipped on Thursday after a surprise build in U.S. crude inventories eased concerns of a supply shortfall as the top consumer heads toward peak winter demand season.

U.S. oil CLc1 settled down 66 cents at $93.43 a barrel after dipping as low as $91.86 earlier. London Brent crude LCOc1 fell 42 cents to $90.94 a barrel.

U.S. crude oil inventories rose 2.8 million barrels last week, government data showed, countering analyst expectations for an 800,000 barrel draw. The data pushed oil further from the record $98.62 struck last week. <EIA/S>

Concerns high prices and economic problems in the United States might hurt consumption growth helped halt oil's record rally, with the U.S. data showing a 0.7 percent dip in demand over the last four weeks compared with a year ago.

"Rather weak demand numbers are still showing up in the weekly data. That's reflective of the trend that we've seen and it is only going to add to the bearishness of the report," said Eric Wittenauer of AG Edwards in St. Louis.

Producer group OPEC lowered its world oil demand growth forecast for the fourth quarter of this year partly due to U.S economic woes.

"The U.S. consumer is facing headwinds from falling house prices, restrictions on borrowing and higher energy costs," OPEC said in its November Monthly Oil Market Report.

Oil prices have surged nearly 40 percent since mid-August, as worries about winter supplies, the weakening dollar and geopolitical tensions drew fresh speculative investment.