(New throughout, updating market activity and comments to U.S.
session; changes byline and dateline, previous LONDON)
By Barani Krishnan
NEW YORK, March 3 (Reuters) - Oil prices edged higher on
Thursday after news of a Russian crude pipeline outage,
shrugging off growing record U.S. crude stockpiles as some
analysts argued the four-day rally was defying fundamentals.
Crude prices fell in early trade but rebounded after
Russia's largest oil producer Rosneft ROSN.MM said one of its
pipelines that served as a link for delivering crude to China
was damaged by power failure. The pipeline is expected to be
fixed in 24 hours, Rosneft said.
Brent futures LCOc1 , the global benchmark for crude, were
up 11 cents at 37.04 a barrel by 11:24 a.m. (1624 GMT) after
plumbing a session low at $36.35.
U.S. crude futures CLc1 rose 30 cents to $34.96, against
its intraday low of $34.19.
"Crude seems to be increasingly discounting bearish news and
data including rapidly rising inventory levels," said Vikas
Dwivedi, analyst at Macquarie Capital. "Market fundamentals, in
our view, suggest the rally is too early, and we expect crude to
retrace to the $30 per barrel range."
In under two months, Brent and U.S. crude futures have
gained about $10, or around 30 percent, a barrel from 12-year
lows of between $26 and $27.
The rally has been fueled by pledges from the Organization
of the Petroleum Exporting Countries to work with other major
oil producers to freeze production at January's highs.
Data from market intelligence provider Genscape suggested
stockpiles at the main delivery hub for U.S. crude futures have
risen to a new peak abive the record high the government
reported on Wednesday, traders who saw the data said.
Genscape's data showed Cushing stockpiles rose 1.1 million
barrels to 68.7 million barels during the week to March 1, above
the 66.3 million barrels in the U.S. government data for week
ending Feb. 26. EIA/S
U.S. crude stockpiles as a whole rose 10.4 million barrels
to an all-time high of 517.98 million barrels last week,
government data showed. EIA/S
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GRAPHIC on U.S. crude ending long-term technical downtrend http://reut.rs/1OKQh6o
FACTBOX-Double hammer in a leap year: when will the oil slump
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