SINGAPORE, Nov 4 - Oil prices eased slightly on Tuesday on expectations that warmer-than-usual weather in the United States would allow already rising supplies in the world's biggest energy market to swell further. U.S. crude futures fell 13 cents at $28.77 per barrel while Brent crude futures were down three cents at $27.33. U.S. government data on Wednesday is expected to show crude stocks rose last week and dealers predict a softening of demand this week since private weather forecaster Meteorlogix predicted above-normal temperatures across much of the United States, including in the northeast, a key heating oil market. The trend of rising U.S. supplies when inventories are normally drawn down in preparation for heating demand during the northern hemisphere winter, has already driven oil prices down nearly 11 percent in the past three weeks from above $32. A survey of analysts on Monday showed on average they expected government data to show distillates stocks, which include heating oil, expanded 600,000 barrels in the week to October 31. Distillate stocks totalled 134 million barrels last week, which was nine percent above year-ago levels. The survey said crude stocks increased 1.5 million barrels last week as imports continued to pour into the United States. "While the stocks are at pretty comfortable levels, if the prices get too low OPEC will start talking about further cutbacks again," said David Thurtell, commodities strategist at Commonwealth Bank of Australia . OPEC, which is keeping a tight rein on its production for fear stocks will rise too fast, was due to cut production 3.5 percent to 24.5 million barrels per day on November 1.
But the group, which controls half the world's oil exports, has come under pressure to loosen its taps and put more oil on world markets. Russia, the world's second-biggest exporter after Saudi Arabia, said current prices were unjustified and oil exporters should not build their wealth only at the expense of consumers in Europe and the United States. "The current price is unjustified," Igor Yusufov, Russia's energy minister, told a news conference. "We are telling OPEC that an urgent production boost is needed to bring prices down at least to $24-$25 per barrel." The OPEC reference crude price was at $27.17 on Friday, its latest assessment, inside the price range of $22-$28 a barrel the group uses to help determine when to raise or cut output. Indonesia's Oil Minister, Purnomo Yusgiantoro, said on Tuesday that OPEC would maintain its $22-$28 reference price band despite Russia's comments. OPEC also came under fire on Monday from the International Energy Agency, which advises 26 industrialised nations on energy issues.
The head of the IEA, Claude Mandil, told OPEC's production policy was keeping world oil stocks too tight just as key consumers such as the United States and Europe were moving towards the peak-demand winter period. "Stocks still need to be replenished," Mandil said. "On that point I differ from what OPEC officials think. Stocks are still at the bottom of the five-year range."//