22 August 2005, 15:18  Oil steady after spike on Jordan attack, Ecuador

Oil held steady above $65 a barrel on Monday after spiking late last week when rocket attacks in Jordan and reduced oil supply from Ecuador highlighted the world's thin cushion of spare production capacity. U.S. crude gained five cents to $65.40 a barrel by 0847 GMT. London Brent crude was one cent down at $64.35, though trading was halted from 0518 GMT after an outage on its electronic trading platform, with no restart time set. Oil prices jumped over $2 a barrel on Friday, partly recovering from a mid-week slump, after two missiles fired at U.S. ships in Jordan's Aqaba port fuelled market concern over the security of supplies from its oil-rich neighbours. Despite the speculative gains, some traders said worries that higher prices are eating into economic growth and the looming end of the peak-demand summer gasoline driving season in the United States could weigh on prices in the coming weeks. Last week's deep draw on gasoline supplies, which took them to the low end of their seasonal range, was offset by the fact that the peak-demand driving season ends in just two weeks and that rising U.S. crude stocks remained well above average. Inventories of heating oil and distillates, demand for which peaks in the winter, also stood above last year's levels, though worry over tightly stretched refining capacity is likely to provide support. "There's a few refinery problems in the U.S. and demand is still good. I think the overall picture is still bullish. You see more and more funds going into the oil market, which is going to keep prices steady," said a Singapore-based oil trader.

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