Oil steadies, US refinery restarts may lift stocks

SINGAPORE, July 17 (Reuters) Oil prices were little changed on Tuesday, hovering within sight of record highs even after a sharp fall in U.S. fuel prices triggered by signs that recovering refinery operations will boost inventories.

London Brent crude for September delivery, the new front-month contract, was down 3 cents to .26 a barrel by 0336 GMT. The August contract ended 25 cents lower on Monday after briefly rising as high as .40, just shy of its record at .65.

U.S. crude for August eased 1 cent to .14 a barrel, after gaining 22 cents on Monday, when it touched a new 11-month high of .50 despite steep losses in gasoline and heating oil prices.

A series of scheduled and unplanned refinery outages in the United States has kept the market on tenterhooks as the country entered the peak demand driving season this summer, but a number of plants are now resuming operations.

Gasoline stocks likely rose by 900,000 barrels last week while distillate inventories probably increased by 1.1 million barrels, a preliminary Reuters poll found. S] Utilisation rates were expected to have risen 0.04 percent last week, helping cut crude stocks by 300,000 barrels.

But analysts said the increase in fuel supplies may do little to soften prices.

''Inventories are still quite low if you look at oil demand, which has been growing quickly,'' said Tony Nunan, risk management executive at Tokyo-based Mitsubishi.

Goldman Sachs said on Monday that oil prices could reach a barrel this autumn and by the end of this year if OPEC did not relent on its export curbs and pump more crude.

Exxon Mobil Corp. restarted a hydrocracker at its huge 563,000 barrels per day refinery in Baytown, Texas, on Monday, while Valero Energy Corp. restarted a 30,000-bpd hydrocracker at its McKee, Texas, plant.

BP also restarted a 60,000-bpd ultracracker over the weekend at its recovering Texas City refinery.

U.S. gasoline futures tumbled 9.86 cents, or 4 percent, to SINGAPORE, July 17 (Reuters) Oil prices were little changed on Tuesday, hovering within sight of record highs even after a sharp fall in U.S. fuel prices triggered by signs that recovering refinery operations will boost inventories.

London Brent crude for September delivery, the new front-month contract, was down 3 cents to $76.26 a barrel by 0336 GMT. The August contract ended 25 cents lower on Monday after briefly rising as high as $78.40, just shy of its record at $78.65.

U.S. crude for August eased 1 cent to $74.14 a barrel, after gaining 22 cents on Monday, when it touched a new 11-month high of $74.50 despite steep losses in gasoline and heating oil prices.

A series of scheduled and unplanned refinery outages in the United States has kept the market on tenterhooks as the country entered the peak demand driving season this summer, but a number of plants are now resuming operations.

Gasoline stocks likely rose by 900,000 barrels last week while distillate inventories probably increased by 1.1 million barrels, a preliminary Reuters poll found. S] Utilisation rates were expected to have risen 0.04 percent last week, helping cut crude stocks by 300,000 barrels.

But analysts said the increase in fuel supplies may do little to soften prices.

''Inventories are still quite low if you look at oil demand, which has been growing quickly,'' said Tony Nunan, risk management executive at Tokyo-based Mitsubishi.

Goldman Sachs said on Monday that oil prices could reach $90 a barrel this autumn and $95 by the end of this year if OPEC did not relent on its export curbs and pump more crude.

Exxon Mobil Corp. restarted a hydrocracker at its huge 563,000 barrels per day refinery in Baytown, Texas, on Monday, while Valero Energy Corp. restarted a 30,000-bpd hydrocracker at its McKee, Texas, plant.

BP also restarted a 60,000-bpd ultracracker over the weekend at its recovering Texas City refinery.

U.S. gasoline futures tumbled 9.86 cents, or 4 percent, to $2.1262 a gallon on Monday, keeping oil prices from reaching new all-time highs. It was trading up 0.8 percent at $2.1430 a gallon by 0305 GMT on Tuesday.

''The current price rally is critically different from last year as the fundamentals are substantially stronger. Global crude oil production is over 1 million bpd lower than last year, while demand is over 1 million bpd higher,'' Goldman Sachs said.

REUTERS PBB DS1117 .1262 a gallon on Monday, keeping oil prices from reaching new all-time highs. It was trading up 0.8 percent at SINGAPORE, July 17 (Reuters) Oil prices were little changed on Tuesday, hovering within sight of record highs even after a sharp fall in U.S. fuel prices triggered by signs that recovering refinery operations will boost inventories.

London Brent crude for September delivery, the new front-month contract, was down 3 cents to $76.26 a barrel by 0336 GMT. The August contract ended 25 cents lower on Monday after briefly rising as high as $78.40, just shy of its record at $78.65.

U.S. crude for August eased 1 cent to $74.14 a barrel, after gaining 22 cents on Monday, when it touched a new 11-month high of $74.50 despite steep losses in gasoline and heating oil prices.

A series of scheduled and unplanned refinery outages in the United States has kept the market on tenterhooks as the country entered the peak demand driving season this summer, but a number of plants are now resuming operations.

Gasoline stocks likely rose by 900,000 barrels last week while distillate inventories probably increased by 1.1 million barrels, a preliminary Reuters poll found. S] Utilisation rates were expected to have risen 0.04 percent last week, helping cut crude stocks by 300,000 barrels.

But analysts said the increase in fuel supplies may do little to soften prices.

''Inventories are still quite low if you look at oil demand, which has been growing quickly,'' said Tony Nunan, risk management executive at Tokyo-based Mitsubishi.

Goldman Sachs said on Monday that oil prices could reach $90 a barrel this autumn and $95 by the end of this year if OPEC did not relent on its export curbs and pump more crude.

Exxon Mobil Corp. restarted a hydrocracker at its huge 563,000 barrels per day refinery in Baytown, Texas, on Monday, while Valero Energy Corp. restarted a 30,000-bpd hydrocracker at its McKee, Texas, plant.

BP also restarted a 60,000-bpd ultracracker over the weekend at its recovering Texas City refinery.

U.S. gasoline futures tumbled 9.86 cents, or 4 percent, to $2.1262 a gallon on Monday, keeping oil prices from reaching new all-time highs. It was trading up 0.8 percent at $2.1430 a gallon by 0305 GMT on Tuesday.

''The current price rally is critically different from last year as the fundamentals are substantially stronger. Global crude oil production is over 1 million bpd lower than last year, while demand is over 1 million bpd higher,'' Goldman Sachs said.

REUTERS PBB DS1117 .1430 a gallon by 0305 GMT on Tuesday.

''The current price rally is critically different from last year as the fundamentals are substantially stronger. Global crude oil production is over 1 million bpd lower than last year, while demand is over 1 million bpd higher,'' Goldman Sachs said.

REUTERS PBB DS1117