Oil rises slightly

Oil rose slightly on Monday as supply concerns in Brazil in the midst of an energy workers strike outweighed ongoing worries that high fuel costs are dragging down consumer nation demand. US crude settled up 10 cents to $145.18 a barrel, after hitting a record above $147 in intraday activity on Friday.
London Brent crude settled 57 cents lower at $143.92 a barrel. Support came as oil workers at Brazil's Petrobras launched a five-day strike that cut output by 136,000 barrels per day (bpd), about 7 percent of its production. "The Petrobras strike is a short-term issue and not really a big factor," said Tim Evans, energy analyst for Citi Futures Perspective in New York.
Oil prices have risen more than seven-fold since 2002 on surging demand from emerging nations like China and rising cash inflows into commodities from investors seeking to hedge against inflation and the weak dollar.
But the rising fuel costs have sparked global protests and cut US fuel demand during the typical peak summer gasoline season. "The main bearish factors have to do with a lack of demand falling away right now. At these prices we are going to see demand continue to drop and drop," said Peter Beutel, president of Cameron Hanover.
"I think we're seeing signs of structural conservation that is going to be with us for a while." US President George W. Bush lifted a presidential ban on offshore drilling on Monday to boost domestic supplies and combat soaring energy prices.
Analysts said the plan would take a decade to bring real results and offer little short-term relief. A congressional ban on offshore drilling also remains in place, and Senate Democratic Leader Harry Reid later on Monday rejected Bush's call to lift the moratorium.
Stocks fell on Monday as renewed fears about fallout from the credit crisis overshadowed initial enthusiasm over a rescue plan for US mortgage giants Fannie Mae and Freddie Mac. Oil has jumped 50 percent this year alone, extending a six-year rally.
Traders remained concerned about possible supply disruptions from Opec member Nigeria - where militants in the oil producing region abandoned a cease-fire - and from Iran amid tensions with Israel and the West over Tehran's nuclear program.Markets were also eyeing a low-pressure system about 1,300 miles east of the Lesser Antilles that could develop into a tropical depression.
A Reuters poll ahead of weekly US government inventory data forecast that US crude stocks fell 1.2 million barrels last week. US gasoline inventories were seen down 300,000 barrels while distillate stocks were seen up 1.9 million barrels.