Oil prices held close to $50 a barrel today ahead of US inventory data that is expected to show tighter supplies in the world's biggest oil consumer as a result of Hurricane Ivan.
New York crude futures slipped 18 cents to $49.72 a barrel following yesterday's surge to a record $50.47. London Brent stepped back 21 cents to $46.24 a barrel.
Investors have shrugged off assurances that global inventories justify much lower prices, preferring to focus on sustained demand growth and the shrinking cushion of spare capacity among world producers.
Fears over stretched global supplies were heightened this week when rebels seeking autonomy in Nigeria said they would declare war in the oil-rich Niger delta, home to most of the country's 2.3 million barrels per day output.
Rebel leader Mujahid Dokubo-Asari said he was in the Nigerian capital Abuja today for talks with President Olusegun Obasanjo.
Asari that his militia's offensive, due to be launched on Friday, would be suspended if an agreement was reached on self-determination and resource control for the vast delta region.
Oil companies have largely ignored Asari's instruction to leave the delta, but stepped up security in the vast area of mangrove swamps and creeks. So far only a small volume of oil output has been closed.