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Written by: Staff
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SINGAPORE, May 12 (Reuters) Oil eased on Friday, after jumping more than $1 the previous day on concern over gasoline supply in the United States ahead of the summer driving season and after new threats against foreign oil workers in Nigeria.

US light crude shed 56 cents to $72.76 a barrel by 0410 GMT on profit-taking, after rising $1.19 on Thursday. London Brent crude lost 36 cents to $73.07 a barrel.

Crude oil's jump is part of a wider rally in commodities as investment funds pile into the once-disparate group of illiquid markets. Copper inched lower on Friday after the previous day's record-highs, while gold drifted down after hitting a 26-year peak on Thursday.

While some industry analysts were dubious with the extent and sustainability of the surge on the metals markets, others believe that the strength of the oil sector will be sustained by strong fundamentals.

''The picture on the energy market is more reliable in the long run as we have seen production capacity of about 1 million barrels offline... which will keep prices elevated,'' Andrew Harrington, resources analyst from ANZ Bank in Melbourne, said.

Oil prices are about 3 percent below last month's record-high of $75.35, also because of supply losses in Nigeria, continued undersupply from Iraq and tension over Iran's nuclear work.

Outages at U.S. oil refineries, including the closure of a unit at Valero Energy Corp.'s Texas City 243,000-bpd plant, outweighed U.S. government data on Wednesday showing gasoline stocks rose for a second-straight week. S] Harrington said the market was quick to react to any refinery supply problems and would remain on edge as weather forecasters warn of another rough Atlantic hurricane season in 2006, which is just three weeks away.

A refusal by the U.S. Environmental Protection Agency (EPA) to grant the state of Texas a clean gasoline waiver, even though the state has seen some fuel supply problems as refiners switch to using ethanol when making gasoline, also stirred concern.

While Texas has only inquired about a waiver and has not formally asked the EPA for one, several other states have done so to help overcome any gasoline shortages.

Threats to Nigeria's oil industry kept the market bullish as three foreign oil workers were kidnapped in the oil capital Port Harcourt on Thursday, renewing fears about the stability of flows from the world's eighth-largest exporter.

The kidnappings came a day after a U.S. oil executive was shot dead in the same city and as almost a quarter of Nigerian output remains shut down due to rebel attacks.

As Iran's President Mahmoud Ahmadinejad expressed his willingness to talk over his country's nuclear programme, which has been keeping the oil markets on the boil, the head of the U.N. nuclear watchdog welcomed moves to avert possible U.N. sanctions against Tehran and appealed for compromise.

REUTERS CS GC1135

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