* Brent November contract expires
* Brent/WTI spread tops $24/bbl again - highest in a year
* U.S. crude, distillate stocks rose last week - API
* Coming up: EIA oil data 10:30 a.m. EDT Wednesday
(Adds API data paragraphs 14-18)
By Robert Gibbons
NEW YORK, Oct 16 Brent crude prices fell on
Tuesday as the front-month November contract expired ahead of
weekly inventory reports expected to show U.S. crude oil
inventories rose last week.
Expiring November Brent retreated only after reaching a
four-week high above $116 a barrel and after Brent's premium to
U.S. crude advanced to $24.28, the highest since October 2011.
U.S. crude seesawed most of the day, but managed a higher
settlement, receiving support from a rally on Wall Street and
from a weaker dollar.
Brent and U.S. crude received a boost early when the euro
reached a one-week peak against the U.S. dollar on speculation
Spain may seek a bailout and end the uncertainty about its
A German ZEW index of investor sentiment rose for a second
straight month in October, news that was also seen as giving
support to the euro and crude futures.
But rising U.S. crude oil stockpiles and concerns about
economic growth in Europe and China kept curbing bullish
"Crude got a temporary boost on the expectations that Spain
will ask for a bailout, and end the uncertainty, but the
consensus is that inventory numbers are going to be bearish,"
said Phil Flynn, analyst at Price Futures Group in Chicago.
Expiring Brent November crude fell 73 cents to go
off the board at $115.07 a barrel. It reached $116.20, the
highest for Brent since prices hit $117.02 on Sept. 17.
Brent December crude fell 40 cents to settle at $114
a barrel, trading from $113.48 to $114.87.
U.S. November crude rose 24 cents to settle at $92.09
a barrel, trading from $91.30 to $92.32. The U.S. November crude
contract expires on Oct. 22.
Brent's premium to U.S. crude fell back and ended at $22.98
a barrel, based on November settlements, after scaling $24
during the session.
Maintenance-curbed North Sea production and the threat that
escalating conflict in Syria could drag neighboring states into
the turmoil have recently helped propel Brent's premium to its
U.S. counterpart, along with the long-running dispute between
the West, Israel and Iran concerning Tehran's nuclear program.
U.S. heating oil and RBOB gasoline futures
also saw choppy trading. Heating oil eased 1.06 cents to $3.1985
a gallon, while gasoline dipped half a cent to $2.8453 a gallon.
RISING U.S. CRUDE STOCKS
U.S. crude stocks rose 3.7 million barrels last week,
according to a report released late on Tuesday by industry group
the American Petroleum Institute. The build, reflecting a boost
in imports, was 2 million barrels more than analyst
U.S. distillate stocks rose 1.8 million barrels, while
gasoline stocks fell 1.2 million barrels.
After inventories rose more than forecast in the week to
Oct. 5, U.S. crude stocks were expected to have increased 1.7
million barrels last week, a Reuters survey of analysts showed.
Gasoline stockpiles were expected to edge up 500,000
barrels, according to the survey, but distillate stocks were
expected to have fallen 1.2 million barrels.
The government's report from the U.S. Energy Information
Administration (EIA) will follow on Wednesday at 10:30 a.m. EDT
U.S. retail gasoline demand last week was down 3.1 percent
compared with a year earlier as higher pump prices curb demand,
a biweekly report from MasterCard said.
Adding to the improved supply picture, Saudi Arabia pumped
around 9.77 million barrels a day (bpd) of crude oil in
September, an industry source said on Monday.
According to official Saudi government figures supplied to
OPEC, the world's biggest oil exporter produced 9.75 million bpd
in August and 9.8 million bpd of crude in July.
A Reuters analysis of U.S. import data shows sales to the
world's top oil consumer have dipped only slightly even with an
unexpected six-month outage at Saudi Aramco's joint venture
refinery in Texas and a fire at a Chevron Corp refinery near San
U.S. crude imports from Saudi Arabia hit a four-year high of
1.425 million barrels per day in the first seven months of 2012,
and have dipped only 130,000 bpd since then.
"Fundamentally there is no shortage of oil, with Saudi
Arabia and others maintaining high output while inventory levels
are also good," said Ken Hasegawa, a commodity sales manager
with Newedge in Tokyo.
"On the other hand, there is tension in the market with what
is happening in Iran and the Turkey-Syria issue. That has put a
floor on prices."
(Additional reporting by Peg Mackey in London and Manash
Goswami in Singapore; Editing by Marguerita Choy, Peter Galloway
and David Gregorio)