Oil slips after surge on gasoline anxiety

By Jane Merriman and Janet McBride

LONDON (Reuters) - Oil drifted down from $70 on Friday, after a surge to an eight-month high in the previous session on fears new problems at U.S. refineries could squeeze gasoline supplies already at unusually low pre-summer levels.

China, the world's second biggest oil consumer, raised interest rates to cool its fast-growing economy nPEK358053. But analysts said it could take time to produce any noticeable impact on its oil demand.

London Brent crude slipped 66 cents to $69.60 a barrel by 1452 GMT, eroding some of the previous day's gains of more than $2 or 3.3 percent, the biggest one-day rise since a 5 percent surge in late January.

U.S. crude was up 34 cents at $65.19 having risen 3.7 percent on Thursday.

"By raising rates, the issue, from an oil perspective, is whether or not that's going to affect how energy intensive China's economic growth is going to be," said Harry Tchilinguirian, senior oil market analyst at BNP Paribas.

He said if China's investment into high-energy consuming areas, such as construction, slowed down it could have a moderating effect on its energy demand growth and, at the margin, oil demand later in the year.

A new wave of U.S. refinery problems, plus supply disruptions in Nigeria have intensified concerns about tight U.S. gasoline supplies ahead of peak demand in the summer.

Murphy Oil's (MUR.N: Quote, Profile, Research, Stock Buzz) refinery in Meraux, Louisiana had to shut this week for unplanned repairs, while several major plants in Texas have had disruptions.