Oil hovers above $91 amid US gasoline supply jump

[January 12, 2011]  SINGAPORE (AP) -- Oil prices hovered above $91 a barrel Wednesday in Asia after a report showed U.S. gasoline supplies rose more than expected, suggesting demand may have slowed.

Benchmark oil for February delivery rose 4 cents to $91.15 a barrel late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.

The American Petroleum Institute said late Tuesday that gasoline inventories rose 7 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had forecast an increase of 2.9 million barrels. Inventories of crude rose 57,000 barrels and distillates added 1.5 million barrels, the API said.

The Energy Department's Energy Information Administration reports its weekly supply data later Wednesday.

"Traders will be eager to see if the huge jump in gasoline stocks is repeated in Wednesday's DOE figures," Cameron Hanover said in a report. "At the root of that increase would be a very low consumption number."

Crude rose $1.86, or more than 2 percent, to settle at $91.11 on Tuesday on news a 800-mile (1,300-kilometer) trans-Alaska pipeline, which normally carries about 620,000 barrels a day, remained shut after a leak was discovered Saturday at a North Slope pump station. Oil production on the North Slope was cut by 95 percent.

Alyeska Pipeline Service Co., which operates the pipeline from Prudhoe Bay, said late Tuesday it received permission from regulators to temporarily restart the flow of oil to keep ice from forming amid frigid winter temperatures. Alyeska said preparations were under way for the restart.

In other Nymex trading in February contracts, heating oil fell 0.3 cent to $2.61 a gallon while gasoline futures slid 1.2 cents to $2.47 per gallon. February natural gas futures gained 2.6 cents to $4.51 per 1,000 cubic feet.

In London, Brent crude was up 10 cents to $97.71 a barrel on the ICE Futures exchange.

[Associated Press; By ALEX KENNEDY]

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