Nigeria fears keep oil price high

Pipelines in Nigeria have been under attack

Oil hit a high of $64 in early trading, before slightly falling, after hitting its highest level in seven weeks amid renewed concerns of supply in Nigeria.

Exports from Nigeria, Africa's largest producer, have been stalled by attacks on the pipelines there.

The increase was also prompted by the fact that US supplies will drop during scheduled maintenance.

By early afternoon US light crude fell to $63.55 a barrel, 36 cents down on £63.80 earlier in the day.

Brent crude stood at $62.85, falling 32 cents on the earlier price of $63.17.

Italian company Eni said it could not honour crude oil export commodities from its Nigerian Brass Rover terminal, which loads about 200,000 barrels a day, following last week's pipeline attack.

This follows an earlier decision by Royal Dutch Shell among others to shut down 630,000 barrels a day of production in Nigeria.

Even while US inventories remained at seven-year highs, traders were concerned about pending maintenance and prolonged unplanned outages at US plants.

The market is sensitive about any disruption to supply, especially before demand peaks in the summer.

Exxon Mobil will close a Texas-based petrol producing unit in May for maintenance.

US gasoline stocks declined by 2.3 million barrels in the week ending 17 March, more than twice as much as expected, because of lower imports and strong demand, the US Department of Energy said.