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SINGAPORE (AFP) - Oil prices were higher in Asian trade Thursday despite a higher-than-expected gain in US energy inventories last week, dealers said.

Traders were focussed more on recent glitches in US refineries that have led to losses in production, they said.

At 11:25 am (0325 GMT) New York's main oil futures contract, light sweet crude for delivery in June, was up 20 cents at 62.75 dollars a barrel after closing down 62 cents at 62.55 dollars a barrel in late US trades.

Brent North Sea crude for July delivery was up 20 cents at 68.17 dollars a barrel.

The US Department of Energy (DoE) said Wednesday in a weekly update that American gasoline (petrol) reserves gained 1.7 million barrels to stand at 195.2 million barrels in the week ending May 11, higher than market expectations of a rise of 1.0 million barrels.

The gain followed an increase of 400,000 barrels the preceding week after steady falls for three months.

But news of recent US refinery glitches and shutdowns have negated the bearish build in gasoline inventories, putting upward pressure on prices, said Victor Shum, senior principal at Purvin and Gertz, Singapore.

"The market is responding to refinery glitches that are continuing to happen. A couple of weeks of inventories build doesn't turn the market around. The US summer driving season is around the corner. Is there enough time for US refineries to increase gasoline production?" Shum said.

"I see some gaining strength today, but not really going beyond the 62 or 63 dollars level," he added.

The market has been concerned over tight gasoline supplies ahead of the holiday driving season, starting at the end of May, when many Americans take to the roads.

The DoE also reported that US crude oil inventories gained 1.0 million barrels to reach 342.2 million barrels last week. That contrasted with analysts' consensus forecasts for a smaller gain of just 125,000 barrels.

Traders have also been tracking events in Nigeria, the world's sixth-biggest crude producer, where output has been slashed by about one quarter owing to recent attacks on its energy facilities.

Home to Nigeria's multi-billion-dollar oil and gas resources, Port Harcourt and the Niger Delta region have seen an upsurge in kidnappings of foreign and local workers in recent months, mainly connected to the oil industry.

vuukle comment

BARRELS

BRENT NORTH SEA

CRUDE

DEPARTMENT OF ENERGY

MILLION

NEW YORK

OIL

PORT HARCOURT AND THE NIGER DELTA

PURVIN AND GERTZ

SHUM

VICTOR SHUM

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