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SINGAPORE (Reuters) - Brent crude held steady above $109 on Thursday,supported by a rebound in U.S. oil prices on hopes that a reversalin oil flow for the Seaway pipeline will reduce a supply glut inthe U.S. Midwest. Investors cast aside worries about higher oil supply and the eurozone crisis that have dogged the market for the past few weeks andbought U.S. crude futures, allowing the front-month contract torebound for the first time in five sessions. West Texas Intermediate (WTI) crude was up 61 cents to $93.42 by0641 GMT, after rising to an intraday high of $93.72. Brent crude for July edged down 21 cents to $109.54 but recoveredfrom a low of $109.01, the lowest intraday price since January 25.Brent-WTI spread for July also narrowed to $15.74 after widening to$19.46 on Wednesday, the widest intraday level in more than amonth. "The Seaway pipeline reversal starts today and this could supportWTI," said Yusuke Seta, a commodity sales manager at Newedge Japan. U.S. crude stockpiles climbed for the eighth week to their highestsince 1990 and stocks at Cushing rose 1 million barrels last weekto a record 45.13 million, government data showed. EIA/S The pipeline is set to reverse its flow on Thursday, moving crudefrom Cushing to Houston, which is in the country's main refiningcenter on the Gulf Coast. "I am still doubtful whether this reversal really works," Newedge'sSeta said. "Cushing inventories climbed up to 75 percent of storage capacityand that indicates a near glut and also a sign to sell the frontmonth, unless we can confirm a continuous stock draw." But inventories could start to fall if, as reported by Kyodo newsagency, U.S. President Barack Obama moves to seek support to tapemergency oil reserves from other Group of Eight leaders at asummit this weekend before the European Union's July embargo ofIranian crude. The International Energy Agency remained ready to release emergencyoil stocks if needed as oil prices remained a threat to the fragileglobal economic recovery despite a recent fall. EURO ZONE Investors are also worried about a possible exit from euro zone byGreece as it failed to form a government to implement austeritymeasures in exchange for rescue funds from the common currencyregion. "The euro zone crisis can only go one way, that is, Greece leavingthe EU on a temporary basis," Jonathan Barratt, chief executive ofBarrattBulletin, a Sydney-based commodity research firm. "If the contagion continues and people's optimism continues todeteriorate, that will translate to lower import orders for Chinaand put oil demand under pressure." The European Central Bank said it had stopped providing liquidityto some Greek banks that have not been successfully recapitalized,highlighting the weak state of its banking sector. IRAN A key focus for the market will be Iran, which is due to resumetalks with world powers next week over its disputed nuclearprogram. Easing tension between Iran and the West has reduced a risk premiumbuilt into oil prices earlier this year, analysts said. Front-monthBrent is down nearly $20 from its 2012 high of $128.40 on March 1. Iran said it was ready to resolve all nuclear issues in the nextround of talks with world powers if the West starts liftingsanctions. It has, however, violated a U.N. Security Council ban onweapons exports by shipping Iranian arms to Syria. Senate Democratic Leader Harry Reid will ask the U.S. Senate toapprove a new package of oil and economic sanctions on Thursdayaimed at further pressuring Iran to abandon its nuclear program, aDemocratic leadership aide told Reuters. But oil industry executives and bankers are assuming Brent oilprices will stay above $100 a barrel in the year ahead, despitemounting economic worries, as any fall below that level wouldtrigger a cut in Saudi Arabia's output and force closures athigh-cost projects around the world. (Reporting by Florence Tan; Editing by Edwina Gibbs ). We are high quality suppliers, our products such as Scroll Tablet PC , Mobile Phone Accessories for oversee buyer. To know more, please visits Quad Band Android Phone.
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