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London: Oil prices fell from near record highs yesterday after Saudi oil minister Ali Al Naimi said markets were well supplied, shrugging off falls in US crude and fuel stocks and bullish Chinese econ-omic data.
US crude was down 67 cents to $110.20 a barrel by 1409 GMT, having earlier risen to within one cent of the $112.21 record hit in the previous session.
London Brent crude was down 40 cents at $108.07 a barrel, having earlier set a new record at $109.98.
"The market rallied on the weak dollar and Nigerian problems overnight, but Saudi talk of a market well supplied may have capped it," said Tom Bentz, analyst at BNP Paribas Commodities Futures Inc.
Saudi Oil Minister Ali Al Naimi told reporters in Paris the market was still well supplied and record prices were not due to any lack of oil.
"I am not going to pull back. I'm not going to dump crude on the market," Naimi said when asked whether Saudi Arabia might change its output.
Despite pleas by consuming nations for the Organisation of Petroleum Exporting Countries (Opec) to raise oil production to help cap rising oil prices, its members insist the markets remain well supplied.
In Nigeria, liftings of Qua Iboe crude oil are expected to be delayed for the second month in a row, traders said yesterday.
New records
The dollar fell to a record low against the euro yesterday, but pared losses as European Central Bank President Jean-Claude Trichet did not drastically change his growth and inflation views for the euro zone.
Inventory data from the United States, the world's largest oil consumer, pushed prices up to new records on Wednesday after it showed US crude oil inventories fell 3.2 million barrels, countering earlier expectations for a build.
Gasoline and distillate stocks also fell by more than had been forecast.
Adding to the bullish brew earlier yesterday, China revised up its 2007 gross domestic product (GDP) growth by 0.5 per cent points to 11.9 per cent and its currency traded at its strongest level against the dollar in over a decade, underlining China's growing economic power and implying undimmed oil demand.
"The crude drop yesterday was a surprise. That is real fundamentals", said Tony Nunan, risk management executive at Tokyo-based Mitsubishi.
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