Oil above $67 in Asia despite high inventories

       Oil prices rose above $67 a barrel yesterday in Asia despite an increase in US crude inventories for a third week, which suggests consumer demand remains weak.
       Benchmark crude for November delivery was up 42 cents at $67.13 by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange. The contract fell 13 cents to settle at $66.71 on Tuesday.
       US oil inventories rose last week, the American Petroleum Institute said late Tuesday. Crude stocks increased 2.8 million barrels while analysts had expected a jump of 2.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
       "There's no doubt that we still have very high levels of inventories, and that's probably going to prevent oil fr om breaking above $75," said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets in Singapore.
       Oil has traded between $65 and $75 for months as investors mull the strength of a global recover y from recession.Crude bounced off the $65 level earlier this week.
       "The support we saw at $65 was quite significant," Moltke-Leth said. "The hope for recovery is still pretty strong, and that's what's holding prices up."
       In other Nymex trading, heating oil rose 0.94 cent to $1.71 a gallon. Gasoline for October delivery gained 2.59 cents to $1.65 a gallon.
       In London, oil prices rose slightly yesterday as traders awaited the weekly US energy inventories report, analysts said.
       New York's main contract, light sweet crude for November delivery, added 48 cents to 67.19 dollars a barrel.
       Brent North Sea crude for November delivery gained 42 cents to 65.91 dollars a barrel.
       "Today, all focus will be on the weekly US fuel inventories data," said VTB Capital analyst Andrey Kryuchenkov.
       "We expect a small rise in US crude stockpiles, while product stockpiles might see another week of significant inventory builds."
       Later on Wednesday, the US government's Department of Energy will release its weekly oil inventory report.
       Analysts polled by Dow Jones Newswires expect crude stocks to have risen by 300,000 barrels in the past week.
       Gasoline stocks are tipped to increase by 800,000 barrels while distillate stocks, which include heating oil and diesel, are seen to rise by 1.1 million barrels.