NEW YORK Brent crude prices fell on Thursday on returning North Sea supply and euro-zone concerns, while U.S. gasoline edged higher as support from supply disruptions after super storm Sandy countered any pressure from data showing rising inventories.
U.S. crude futures pushed nearly 1 percent higher on supportive economic data and a drop in crude oil inventories.
After Hurricane Sandy battered the region, logistical problems from power outages and navigational hazards continued to threaten fuel and crude oil deliveries in the New York area, including the New York Harbor delivery point for New York Mercantile Exchange fuel futures contracts.
Brent December crude fell 53 cents to settle at $108.17 a barrel, just above the 100-day moving average of $108.14, after slipping as low as $107.75.
The expected restart of the North Sea Buzzard oilfield on Thursday, after delays in bringing back production that has been shut by maintenance since September 4, weighed on Brent futures.
Worries about debt-laden Greece and the euro-zone economies, that pushed the euro lower against the U.S. dollar, added to pressure. <USD/>
U.S. December crude rose 85 cents to settle at $87.09 a barrel, having swung from $85.92 to $87.42.
U.S. crude inventories fell 2.05 million barrels, instead of the expected build of 1.5 million barrels, the U.S. Energy Information Administration said in its weekly report on Thursday, delayed a day because of Sandy.
"We saw that draw on crude and that helped put a bid in the market. I think the market found some support earlier from the employment number that had come out and the consumer confidence numbers," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.
Brent trading volume outpaced U.S. crude turnover. Brent's dealings were 5 percent above its 30-day average, while U.S. volume lagged its 30-day average by 18 percent.
Brent's premium to U.S. crude slipped to $21.08 a barrel, based on settlements. The spread narrowed to $19.08 on October 22, then recovered to reach $24.33 on October 29, before sliding back.
December contracts were in front-month position for U.S. RBOB gasoline and heating oil futures after November contracts expired on Wednesday.
U.S. RBOB gasoline futures seesawed much of the session but ended 0.33 cent higher to settle at $2.6336 a gallon, even after the EIA said gasoline inventories rose 935,000 barrels, which was more than expected.
Heating oil futures, the benchmark distillate contract, fell nearly 1 percent, dropping 2.91 cents to settle at $3.0332 a gallon. Heating oil slipped below the 200-day moving average of $3.0287 during the session, but then , climbed back above it.
The EIA report showed total distillate stocks fell only 93,000 barrels, much less than the expected drop of 1.3 million barrels in a Reuters survey of analysts.
A 12.5 percent drop in distillate demand over the past four weeks compared to the year ago period also weighed on heating oil prices.
"The larger problem exists at the storage terminals where lack of power is restricting supply movement toward the tertiary or retail level of the distribution chain," wrote Jim Ritterbusch, President, Ritterbusch & Associates, in a research note, after noting that refinery damage was not catastrophic as had been feared ahead of the storm.
SUPPORTIVE U.S. ECONOMIC DATA
U.S. companies added jobs in October at the fastest pace in eight months, supportive data for fuel demand and a sign of modest improvement in the labor market just days before next Tuesday's presidential election.
Other data on Thursday showed a sharp improvement in consumer confidence and a drop in new claims for jobless benefits, while there were mixed signals regarding the health of U.S. manufacturing.
U.S. stocks rose 1 percent on Thursday on the bullish consumer confidence and private-sector jobs data. .N
The U.S. Labor Department will release the October jobs report on Friday. Economists polled by Reuters expect it to show nonfarm payrolls increased 125,000, while the jobless rate ticked up to 7.9 percent from 7.8 percent.
FACTBOX-Refineries, pipelines, terminals after Sandy:
Graphic on 24-hr Brent chart analysis:
Graphic on 24-hr U.S. oil chart analysis: