* Saudi Arabia cuts oil prices for U.S. customers
* Brent, WTI touch respective 4-year, 3-year lows
* Distillate, gasoline stocks grew last week - API data
(Updates prices, recasts lead, adds American Petroleum
By Sam N. Adams
NEW YORK, Nov 4 Oil markets retreated from
multi-year lows on Tuesday but still fell more than 2 percent
after Saudi Arabia cut export prices to the United States
threatening to deepen a global supply glut that has driven
prices down 30 percent since June.
U.S. crude futures settled down $1.59 at $77.19 after
reaching the lowest intraday price since October 2011 in the
The price of Brent for next-month delivery settled
down $1.96 at $82.82 after touching its lowest point since
Refined product stocks jumped last week, surprising those
analysts who expected declines, according to data from the
American Petroleum Institute released on Tuesday after oil
prices settled. Distillate fuels stockpiles rose by 155,000
barrels instead of the 1.8-million-barrel drop predicted in a
Reuters poll of analysts. Gasoline stocks rose by 240,000
barrels despite an expected 400,000 barrel increase.
U.S. crude stocks fell 639,000 barrels last week to 374.9
million in the wake of the revved-up refinery output. [ID:
On Monday, Saudi Arabia surprised the market by raising
prices for Asia and Europe but cutting prices for U.S.
customers. Oil slid as much as $2 a barrel in
late trade, and the sell-off continued Tuesday, triggering
"The Saudis have basically declared war on the U.S. oil
producers," said Phil Flynn at Price Futures Group. "I think
they believe that the only way they're going to survive in the
long term is to break the market in the short term."
On Monday, longer-dated oil futures became more expensive
than near-term contracts, putting charts into a contango
structure for the first time since Jan. 17. The futures curve
left contango in the afternoon, and the spread between December
and January contracts stood at 2 cents at 4:48 p.m. EST (2148
NO OPEC CONSENSUS
The Organization of the Petroleum Exporting Countries (OPEC)
meets Nov. 27, but there are no clear signs whether it will
The United Arab Emirates oil minister said the country is
"not panicking". Venezuela and Ecuador have said they are
working on a joint proposal to defend oil prices.
"I can see OPEC and Saudi Arabia playing the long game. A
low price for a period of time may actually play into the hands
of people with a lot of reserves in the ground at cheap cost,"
Pierre Lorinet, chief financial officer of Trafigura, said at
the Reuters Global Commodities Summit.
Saudi Oil Minister Ali al-Naimi has not commented publicly
on the oil market since September. On Wednesday, he will meet
Venezuela's foreign minister Rafael Ramirez, also the head of
its OPEC delegation, according to a person close to the Saudi
(Additional reporting by Sam Wilkin in London, Jane Xie in
Singapore; Editing by Dale Hudson, Michael Urquhart, Jane
Merriman, Jessica Resnick-Ault and Diane Craft)