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Oil prices higher on US gasoline reserves concerns

SINGAPORE, April 27, 2007 (AFP) – Oil prices were higher in Asian trade Friday with tighter US gasoline (petrol) supplies a key concern ahead of the US summer driving season, dealers said.

SINGAPORE, April 27, 2007 (AFP) – Oil prices were higher in Asian trade Friday with tighter US gasoline (petrol) supplies a key concern ahead of the US summer driving season, dealers said.

At 10:20 am (0220 GMT), New York’s main contract, light sweet crude for June delivery, was up 16 cents to 65.22 US dollars a barrel from 65.06 dollars in late US trades Thursday.

Brent North Sea crude for June delivery gained 17 cents to 67.82 dollars.

US gasoline supplies are being closely watched ahead of the summer driving season starting in May when many Americans take to the road for their vacation.

Latest figures from the Department of Energy (DoE) showed gasoline reserves fell 2.8 million barrels in the week ending April 20, against market forecasts of a fall of just 500,000 barrels.
It was the 11th consecutive weekly drop in gasoline reserves.

"We are in a situation where the clock is running down to the summer driving season," said Tobin Gorey, a commodity analyst with Commonwealth Bank of Australia in Sydney.
"That certainly is still the main issue," he said of US gasoline reserves.

Meanwhile, US crude oil inventories increased 2.1 million barrels last week, which confounded analysts’ forecasts for a decrease of 1.5 million barrels.

Concerns over US gasoline reserves have overshadowed progress made by the European Union and Iran in nuclear talks.

Iranian negotiator Ali Larijani said Thursday that talks with EU foreign policy chief Javier Solana had made progress towards a "united view" on ending the crisis over Tehran’s refusal to halt uranium enrichment.
"I think in some areas we are approaching a united view and that is to say the best approach is to have the issue settled through negotiation," Larijani said after a second day of talks with Solana in the Turkish capital Ankara.

The talks were the first face-to-face meetings between Larijani and Solana since the UN Security Council imposed a second round of sanctions on Iran in March to punish its continuing enrichment work.
Western nations fear that Iran is trying to make a nuclear weapon but Iran contends that its nuclear program is for peaceful energy production.

Iran is the world’s fourth-largest oil exporter.