By Claire Rangel Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Crude oil futures are lower Monday as concerns about hefty oil inventories in the U.S. continue to weigh on the market amid weak demand. Light, sweet crude for January delivery recently traded 32 cents, or 0.5%, lower at $69.55 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange traded 8 cents, or 0.1%, higher at $71.94 a barrel. Last week, the U.S. government reported stocks at Cushing, Okla., the delivery point for the WTI contract, were at 33.4 million barrels, fast approaching record levels. "A resurgence of aversion towards riskier assets and high inventories at Cushing continue to pressure front month WTI prices," said Barclays Capital in a research note. With U.S. demand still lackluster with gasoline and diesel consumption lagging the global economic recovery, traders are growing more concerned that it will take a while for these stocks to be drawn down. This is placing increasing pressure on the front month January crude contract, which oil market participants are selling heavily. This caused the discount between the first and second month contracts to widen to more than $2.50 Monday, the widest level since April. Traders are discounting the January contract, as this represents the ample volume of crude supplies available. "People are realizing that for the short-term we are overloaded with supply," said Phil Flynn, analyst with PFGBest in Chicago. "We have more production coming from OPEC and there seems to be a glut of oil in the marketplace." Oil had dipped overnight to $68.59 a barrel, but those earlier losses were pared after some positive economic news that Abu Dhabi will make $10 billion available to help relieve Dubai's immediate debt issues. The Dubai government will use the cash to pay part of the debt held by conglomerate Dubai World. But Flynn noted that the Dubai news did not shake up the oil market too much as it's current focus is on the fundamentals. A slight weakening in the dollar against the euro, though, also lifted oil prices off their lows. Oil tends to rise on a weaker dollar as this makes the dollar-denominated commodity cheaper to other currency holders. With oil's sharp descent in recent weeks to below $70 a barrel, the oil market is looking ahead to the Organization of Petroleum Exporting Countries meeting in Angola on Dec. 22, to see if it will make any changes to its production quotas. Early indications from members of the organization are that they do not expect to raise output. Front-month January reformulated gasoline blendstock, or RBOB, recently traded 2.41 cents lower at $1.9509 a gallon. January heating oil recently traded 1.44 cents, or 0.8%, lower at $2.0124 a gallon. -By Claire Rangel, Dow Jones Newswires; 212-416-2846; claire.rangel@dowjones.com.

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