Brent slips toward US$124 on fed comments

Brent crude extended losses toward $124 a barrel on Wednesday after the U.S. central bank dashed hopes of further economic stimulus, while news that Saudi Arabia is likely to keep output high in the event of a strategic stocks release also weighed. Industry data showing a larger-than-expected rise in crude inventories in the United States, the world\'s top consumer of oil, also pressured prices although losses were capped by further disruption in exports from the North Sea. Front-month Brent crude fell 32 cents to $124.54 a barrel by 0243 GMT, after touching a low of $124.42 earlier. Brent settled down 57 cents at $124.86 on Tuesday. U.S. crude futures lost 29 cents to $103.72, after dropping by more than $1 in the previous session. \"The Fed comments had an influence on oil prices, more for the U.S. market than Brent and that\'s why we saw the Brent/WTI spread widening,\" said Natalie Robertson, a commodities strategist with ANZ Bank in Melbourne. \"Brent was supported by supply side disruptions in the North Sea.\" Brent\'s premium to U.S. crude slipped 2 cents to $20.83, after reaching around $21 intraday on Tuesday, the highest since October, Reuters data showed. Federal Reserve policymakers appear less inclined to launch a fresh round of monetary stimulus as the U.S. economy gradually improves, according to minutes for the central bank\'s March meeting. Asian shares eased while the U.S. dollar held on to hefty gains on Wednesday after the minutes from the U.S. Federal Reserve\'s March meeting were released. Supply issues Oil prices were also pressured from news that Saudi Arabia is likely to maintain high oil production in the event consumer countries release strategic oil reserves, though the kingdom will not seek to attract buyers for more oil by discounting its crude. But actual and potential disruptions continue to be a floor under prices, with at least seven cargoes of North Sea Forties crude loading in April being delayed following production problems. The number of known delayed shipments is up from five at the end of last week, trading sources said. There was talk of an eighth delayed shipment but this could not be confirmed. A ban on European insurance cover for Iranian oil exports from July 1 is also threatening to curtail shipments and raise costs for major buyers. Japan and South Korea have lobbied for exemptions, but insurance and shipping executives say a complete ban now looks likely. Ahead of the European Union embargo targeted at Iran\'s oil trade, Japanese insurers are looking to slash coverage for transporting Iranian crude, industry sources said on Wednesday. U.S. crude oil inventories rose 7.8 million barrels in the week to March 30, the industry group American Petroleum Institute said on Tuesday, a much larger increase than expected. The U.S. Energy Information Administration\'s crude inventory report is due out later on Wednesday.