U.S. light, sweet crude for March was flat, following a gain of $2.19 in New York on Thursday.London Brent crude for the new front-month April contract was down slightly.U.S. Energy Secretary Sam Bodman said on Thursday he did not expect Exxon Mobil to have trouble replacing oil supplies from Venezuela, but added that the nation's Strategic Petroleum Reserve would be available if needed.The South American country, one of the largest crude exporters to the United States, cut shipments to the U.S. company earlier this week in retaliation over a legal dispute.
"Venezuela will not affect the crude supply fundamentally. There will be some risk premium but there will not be any natural shortfall in crude," said Gerard Burg of National Australia Bank in Sydney.
Major oil producers in the Middle East have already assured the United States they could compensate for a supply disruption if Venezuela slows exports.Supply worries also eased as Mexico re-opened all three of its main oil exporting ports on Thursday, a day after they were closed because of bad weather in the Gulf of Mexico.
The market continued to fret over slowing U.S. oil demand as economic woes lingered.
U.S. Federal Reserve Chairman Ben Bernanke on Thursday painted a gloomy picture of a U.S. economy facing risks of both slow growth and inflation, and held open the option of more interest rate cuts.
Separately, former U.S. Federal Reserve Chairman Alan Greenspan said the U.S. economy was "clearly on the edge" of a recession, and was being burdened by high oil prices.
