Oil prices edged down towards $58 today, as US winter fuel supplies looked more comfortable after data showing a smaller-than-expected drop in natural gas stocks.
US February light crude futures slipped 13 cents to $58.15 a barrel by 6.40 am, after losing 28 cents yesterday.
London Brent crude eased 5 cents to $56.50 a barrel, following a 17-cent fall the previous day.
The market lost ground yesterday after US government data showed natural gas inventories fell last week by 162 billion cubic feet (bcf), against expectations of a 169 bcf draw.
This helped ease worries over winter supplies together with forecasts predicting that much of the United States would get unseasonably mild temperatures in the first three months of 2006.
But a freezing spell in the world's third-largest oil consumer Japan, driving down heating fuel stocks and spurring increased January refinery production, shows the weather remains a risk that could boost fuel demand.
"The big X factor is the weather," said broker John Brady of ABN AMRO in New York. "I would expect to see a slightly lower day if it continues to be pressured by the gas market," he added.
Lost supply from Nigeria remained a supportive factor, after Shell declared force majeure, a technical release from honouring contracts, delaying delivery of more than 300,000 barrels per day (bpd) of some of the world's finest quality oil.
Shell was forced to close a pipeline that pumps 180,000 bpd after unidentified gunmen attacked it on Tuesday. Oil dealers said the shutdown could last around six days.