Brent Rises At June Contract Expiration, U.S. Crude Falls


Front-month Brent crude futures rose and went off the board on Thursday at the highest settlement since March, while U.S. futures fell, snapping a string of three straight higher settlements.

While concerns about the crisis in Ukraine and a tightening global oil market continued to support oil futures and helped June Brent finish higher, Brent for delivery in nearby months fell on pressure from news of returning Libya supply.

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OPEC-member Libya's output was at 300,000 barrels per day (bpd) with the El Feel field at full capacity and Wafa field back at work after protests ended, an official with the National Oil Corporation said.

Royal Dutch Shell lifted force majeure on exports of Forcados crude from Nigeria, adding to the pressure on oil.

Expiring Brent crude for June rose 25 cents to settle at $110.44 a barrel, its highest settlement since settling at $111.20 on March 3. Brent July crude fell 22 cents to settle at $109.09 a barrel.

U.S. June crude fell 87 cents to settle at $101.50 a barrel after Wednesday's settlement at $102.37, its highest finish since April 21. The June contract expires Tuesday.

U.S. RBOB gasoline and heating oil futures also fell on Thursday, after three consecutive higher settlements.

"Brent has more risk from the geopolitical factors and this week's inventory data showed ample supply in the U.S. even with stocks down in Cushing (Oklahoma)," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.

Crude oil stocks at the Cushing hub, delivery point for the New York Mercantile Exchange's (NYMEX) U.S. crude contract, fell 592,000 barrels in the week to May 9, the U.S. Energy Information Administration's (EIA) data released on Wednesday showed.

But total U.S. crude inventories rose 947,000 barrels to 398.5 million barrels, as domestic production hit a 28-year high of 8.43 million barrels, the EIA said.

The exclusion this week of pro-Moscow separatists from talks among Ukraine's interim leaders on plans to give the eastern regions greater autonomy cast doubt over moves to defuse the political crisis in Central Europe.

Russian and European Union energy ministers are to meet May 19 to set a date for more talks with Ukraine to end a dispute over gas prices and avoid a potential interruption of energy supplies.

Also highlighting supply worries, OPEC oil producers will need to raise output in the second half of 2014 to meet global demand as China builds its strategic reserves and stocks in industrialized countries remain low, the International Energy Agency said on Thursday.

(By Robert Gibbons; Additional reporting by Christopher Johnson in London and Keith Wallis in Singapore; Editing by Chris Reese, David Gregorio and Tom Brown)