Oil Falls Below $59 on Signs U.S. Supplies Rose, Warmer Weather -- By Mark Shenk
Oct. 30 (Bloomberg) -- Crude oil fell the most in more than three weeks as warm U.S. weather reduced demand for heating fuels, helping inventories to increase.
Supplies rose 2.75 million barrels, according to the median of eight responses in a Bloomberg News survey. Stockpiles fell the previous week when the Louisiana Offshore Oil Port, the largest U.S. import terminal, shut because of bad weather. Higher-than-normal temperatures will cover most of the U.S. from Nov. 6 through Nov. 12, the National Weather Service reported.
``Inventories are high, spare capacity is growing and demand is going nowhere,' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``Until winter hits, demand will be somnolent.'
Crude oil for December delivery fell $2, or 3.3 percent, to $58.75 barrel at 11:28 a.m. on the New York Mercantile Exchange. Futures are down 4 percent from a year ago. Prices have plunged 25 percent from the record of $78.40 a barrel reached July 14 amid concern that fighting in Lebanon would spread through the Middle East, source of a third of world's oil.
``Inventories are looking healthier and the weather should be getting warmer,' said Ric Navy, a broker at BNP Paribas SA in New York. ``The market is vulnerable on the downside. OPEC will be tested in the weeks ahead.'....
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