RTRS:REFILE-NYMEX-U.S. crude rises 3rd day on hopes for euro zone
* EU leaders work on rescue for Spain's banks - sources
* U.S. crude stocks fell, but less than forecast - EIA
* Coming up: U.S. jobless claims 8:30 a.m. EDT Thursday
NEW YORK, June 6 (Reuters) - U.S. crude futures rose for a
third straight day on Wednesday as European efforts to rescue
troubled Spanish banks sent the euro higher, weakened the dollar
and boosted equities and oil prices.
Oil prices also received support when a U.S. Fed official
hinted at more monetary easing to support the economy.
Germany and European Union officials are urgently exploring
ways to rescue Spain's debt-stricken banks, although Madrid has
not yet requested assistance and is resisting political
conditions, European Union sources said.
The euro rallied against the dollar and the yen after the
European Central Bank held its main interest rate at 1.0
percent, resisting international pressure to provide more
support for the euro zone's economy.
Atlanta Federal Reserve President Dennis Lockhart said the
Federal Reserve may need to consider further monetary easing if
a wobbly U.S. economy falters or Europe's crisis triggers a
broader financial shock.
Lockhart's remarks bolstered expectations that, after recent
data showing a sharp slowdown in employment growth in May and a
downwardly revised first-quarter U.S. gross domestic product
figure, the U.S. central bank will decide to take some type of
action at its June 19-20 meeting to stimulate a slowing economy.
Less indicative of the need for more stimulus, the Federal
Reserve said in its latest "Beige Book" summary that U.S.
economic growth picked up over the last two months and hiring
showed signs of a "modest increase."
Helping limit oil's rise, the Energy Information
Administration reported that U.S. crude stocks fell 111,000
barrels last week, snapping a string of 10 builds but falling
less than expected and much less than the drop of 1.8 million
barrels reported by industry on Tuesday.
U.S. gasoline stocks rose 3.35 million barrels and
distillate stocks rose 2.25 million barrels, the EIA said, more
than expected.
FUNDAMENTALS
* On the New York Mercantile Exchange, July crude
rose 73 cents, or 0.87 percent, to settle at $85.02 a
barrel, having traded from $84.03 to $86.27.
* Iran questioned world powers' readiness for negotiations
over its disputed nuclear program and accused the U.N.
International Atomic Energy Agency of behaving like a
Western-manipulated intelligence agency, keeping up its sparring
ahead of talks with major powers in Moscow.
* Oil exports from southern terminals in the Iraqi city
Basra were restored to 2.37 million barrels per day (bpd) on
Wednesday, a shipping source said, following a three-day
slowdown due to rough weather.
* A senior Iranian official expressed hope that his country
and the U.N. nuclear watchdog would soon be able to seal a
framework agreement to resume a stalled investigation into
Tehran's disputed nuclear activities.
* Chinese Premier Wen Jiabao told Iranian President Mahmoud
Ahmadinejad that China opposes any Middle East country acquiring
nuclear weapons, Xinhua reported. Wen added that China "upholds
that the Iranian nuclear issue should be addressed through
diplomatic channels in an impartial way."
* Bank of America-Merrill Lynch lowered its crude oil price
forecasts, citing stronger-than-expected supply growth coupled
with weakening European demand and softer growth in emerging
markets and the United States.
MARKETS NEWS
* U.S. stocks rose, with the S&P staging a major reversal
above its 200-day moving average, as talk of a rescue of Spain's
troubled banks and hopes for more monetary stimulus sparked a
rebound from recent selling.
* Gold prices ended a shade higher after a choppy session,
as an encouraging assessment of the U.S. economy by the Federal
Reserve wiped out the safe-haven metal's early peak at a
one-month high built on speculation of more monetary easing from
central banks.
* London copper prices rose for the first time in five
sessions and U.S. copper futures also rose amid optimism for a
European rescue of Spain's troubled banks.
UPCOMING DATA/EVENTS
* U.S. jobless claims data due at 8:30 a.m. EDT (1230 GMT)
on Friday.
* U.S. Energy Information Administration natural gas storage
data due at 10:30 a.m. EDT (1430 GMT) on Thursday.
TOTAL MARKET VOLUME OPEN INTEREST
CURRENT Jun 05 30D AVG Jun 05 NET CHNG
CRUDE 606,870 478,692 539,011 1,456,604 -10,156
RBOB 145,822 123,941 149,510 292,481 4,249
HO 141,849 107,811 133,850 318,492 1,319
