Commodities: Oil slips on conflicting demand estimates

LONDON (ShareCast) - Crude oil futures surrendered the previous session's gains as investors scratched their heads over contradictory data on the outlook for global oil demand.

Crude oil futures for March delivery lost 50 cents to settle at $97.01 a barrel on the New York Mercantile Exchange.

Oil prices turned lower after the International Energy Agency reduced its demand growth forecast Wednesday just a day after the Organisation of the Petroleum Exporting Countries increased its growth outlook.

In its monthly report the Paris based IEA said expectations for increased demand in 2013 could be 'overly optimistic.' The IEA said the sharp rise in Chinese demand at the end of 2012 might not be sustained.

The IEA expects oil demand to grow by 840,000 barrels a day in 2013, down 90,000 barrels a day from its previous estimate.

Inversely, oil cartel OPEC said world oil demand would grow faster than previously thought in 2013. It hiked its demand forecast by 80,000 barrels a day to 840,000 barrels for 2013, citing signs of a recovery in the global economy.

Traders also mulled the latest US Energy Information Administration weekly inventory report.

Crude supplies rose by 600,000 barrels for the week ended February 8th, confounding expectations of a 2.5m barrel rise.

The EIA said gasoline supplies declined 800,000 barrels and distillates, used in heating oil and diesel, fell by 3.7m barrels.

On the ICE futures exchange Brent crude closed down 11 cents at $118.55 a barrel.

Among precious metals gold fell to a six month low on Wednesday as investors paused for breath ahead of this weekend's G20 meeting.

Gold for April delivery fell $4.50 to settle at $1,645.10 an ounce on the Comex division of the New York Mercantile Exchange.