Oil slips from record, Saudi says supplies ample

By Matthew Robinson

NEW YORK (Reuters) - Oil slipped from record highs on Thursday as top exporter Saudi Arabia insisted markets were amply supplied despite falling U.S. inventories.

U.S. crude gave up 34 cents to $110.53 a barrel by 1:51 p.m. EDT after trading just one cent shy of the record $112.21 struck on Wednesday. London Brent crude fell 2 cents to trade at $104.45 a barrel, after hitting an all-time high of $109.98 earlier.

"The market rallied on the weak dollar and Nigerian problems overnight, but Saudi talk of a market well supplied may have capped it," said Tom Bentz, analyst at BNP Paribas Commodities Futures Inc.

Ali al-Naimi, oil minister for top OPEC producer Saudi Arabia, said supplies were adequate and record prices were not due to a lack of oil, adding the Kingdom did not plan to change current output.

"I am not going to pull back. I'm not going to dump crude on the market," Naimi told reporters at a conference in Paris.

"In my perspective, the oil market is well-supplied. The price is not at that level because of any shortage in supply," he added.

Oil shot to fresh peaks on Wednesday after government data showed a surprise drop in crude oil and fuel supplies.

Consumer nations have repeatedly asked OPEC producers to increase production to help ease the sting of rising prices.