Crude oil prices fell Thursday, following on a drop of more than US$1 a barrel the previous day after US government data showed crude oil and gasoline supplies on the rise. Worries about Iran limited the declines.
Light, sweet crude for March delivery dropped 29 cents to US$66.27 a barrel in electronic trading on the New York Mercantile Exchange by afternoon in Europe. Brent crude for March fell 48 cents to US$64.55 a barrel on London's ICE Futures exchange.
Nymex heating oil futures fell nearly a cent to US$1.8160 a gallon (3.8 liters), while gasoline futures were down more than a cent to US$1.7178 a gallon. Natural gas futures fell 23 cents to US$8.490 per 1,000 cubic feet.
The market was keeping watch on a meeting Thursday by the International Atomic Energy Agency's board, which was deciding whether to refer Iran to the UN Security Council over concerns that it may be seeking nuclear weapons.
Iran, OPEC's second-largest oil producer, insists its nuclear program is aimed at generating electricity, but the US and other countries fear the research could be used to create nuclear weapons. Europe, Russia and the United States publicly back a referral.
If the Iran tension eases, crude prices should moderate with the end of winter in the Northern Hemisphere, and the continuing recovery after last year's hurricanes in the US, said Richard Rose of Oriel Securities.
Prices fell Wednesday after the US Department of Energy said in its weekly supply report that commercial inventories of crude oil climbed last week by 1.9 million barrels to 321 million barrels, or 11 percent above last year. Gasoline inventories grew by 4.2 million barrels to 219 million barrels, or roughly equal to last year's level.
The report showed a slight decline in inventories of distillate fuels, which include diesel and heating oil.
The Organization of Petroleum Exporting Countries also said at its meeting this week that it would keep oil output steady. The group said it would discuss a cut at its next meeting in March.
The supply fears come at a time when Nigeria's exports have been reduced because of recent violence against oil companies and as Iraqi production remains hindered by sabotage and a lack of security.
Three mortar shells exploded Thursday at a northern Iraqi plant used for cleaning and processing crude oil, triggering a fire but causing no casualties, officials said. The complex processes about 150 000 barrels of the crude oil a day, the Northern Oil Cosaid.
Oil Ministry spokesperson Assem Jihad confirmed the attack, but said work at the complex had stopped about a week ago following an attack on the main pipeline. - Sapa-AP