Oil above $67 in Asia despite high inventories

[September 30, 2009]  SINGAPORE (AP) -- Oil prices rose above $67 a barrel Wednesday in Asia despite an increase in U.S. crude inventories for a third week, which suggests consumer demand remains weak.

Benchmark crude for November delivery was up 42 cents at $67.13 by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange. The contract fell 13 cents to settle at $66.71 on Tuesday.

U.S. oil inventories rose last week, the American Petroleum Institute said late Tuesday. Crude stocks increased 2.8 million barrels while analysts had expected a jump of 2.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

"There's no doubt that we still have very high levels of inventories, and that's probably going to prevent oil from breaking above $75," said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets in Singapore.

Oil has traded between $65 and $75 for months as investors mull the strength of a global recovery from recession. Crude bounced off the $65 level earlier this week.

"The support we saw at $65 was quite significant," Moltke-Leth said. "The hope for recovery is still pretty strong, and that's what's holding prices up."

In other Nymex trading, heating oil rose 0.94 cent to $1.71 a gallon. Gasoline for October delivery gained 2.59 cents to $1.65 a gallon.

In London, Brent crude rose 39 cents to $65.88 the ICE Futures exchange.

[Associated Press; By ALEX KENNEDY]

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.