(Corrects paragraph 2 to show Brent hit an intraday high of $67.65
on Thursday, not $67.52)
SEOUL, July 12 (Reuters) - Oil prices rose on Friday as U.S. oil
producers in the Gulf of Mexico cut more than half their output in the
face of a tropical storm and as tensions continued in the Middle East.
Brent crude futures were up 37 cents, or 0.6%, at $66.89 per
barrel by 0115 GMT. The international benchmark settled down 0.7% on
Thursday after hitting its highest since May 30 at $67.65 a barrel.
U.S. West Texas Intermediate (WTI) crude futures were up 34
cents, or 0.6%, at $60.54 a barrel. The U.S. benchmark closed 0.38%
lower on Thursday after marking its highest since May 23 at $60.94.
By Thursday, oil companies in the Gulf of Mexico had cut more
than 1 million barrels per day (bpd) of output, or 53% of the region's
production, due to Tropical Storm Barry.
The storm was forecast to become a category one hurricane with at
least 74-mile-per hour (119 km-per-hour) winds.
"Brent crude oil ... extended its gains as storms in the Gulf
of Mexico halted production of oil and U.S. oil inventories continued
to recede more than expected," ANZ Bank said in a note.
U.S. crude oil inventories have decreased for four consecutive
weeks. U.S. crude stocks fell 9.5 million barrels in the week to July
5, the Energy Information Administration (EIA) said, a drop that was
more than triple the 3.1 million-barrel draw expected by analysts.
Meanwhile, Iran's alleged attempt to block a British-owned tanker
heightened tensions in the Middle East in the wake of attacks on
tankers and the downing of U.S. drone by Iran in June.
"While a full-scale military conflict remains the least
likely scenario, the strong increases for cost of insurance will make
for a most costly transportation of crude and see new routes explored,
delaying crude arrivals," said Edward Moya, senior market analyst
at OANDA in New York.
But a lower 2020 oil demand outlook from the Organization of the
Petroleum Exporting Countries kept price gains in check. OPEC said the
world would need 29.27 million bpd of crude from its 14 members in
2020, down 1.34 million bpd this year.
(Reporting by Jane Chung; Editing by Joseph Radford)
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