Sept. 18 (Bloomberg) -- Crude oil pared its weekly gains as investors sold contracts to lock in profit after prices climbed above $73 a barrel this week on expectations of higher demand. Oil has risen following reports this week of an expansion in housing starts and industrial capacity utilization in the U.S., the world’s largest energy user. Crude has traded between $67 and $73 since Sept. 1. “We’ve had a lot of gains within this month so we can expect some selling,” said Ken Hasegawa, a commodity derivatives sales manager at broker Newedge in Tokyo. “The price range has narrowed. This will continue for another one or two weeks.” Crude oil for October delivery was at $72.33 a barrel in electronic trading on the New York Mercantile Exchange, down 14 cents at 1:03 p.m. in Singapore. Earlier it fell as much as 51 cents, or 0.7 percent, to $71.96. Futures have risen 4.4 percent this week and 62 percent this year. Housing starts in the U.S. rose in August to the highest level in nine months, the Commerce Department said yesterday, led by construction of multifamily dwellings. “Housing starts were slightly positive, building permits a little more so, and initial jobless claims were down,” said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. “What we’ve had recently is a lot of relatively good U.S. economic data.” U.S. Economy The number of Americans filing first-time claims for jobless benefits fell unexpectedly last week, a sign the labor market is deteriorating at a slower pace. Applications dropped by 12,000 to 545,000 in the week ended Sept. 12, from a revised 557,000 the week before, Labor Department data showed yesterday. Gains in oil prices this week have been tempered by still ample inventories in the U.S. Stockpiles of crude oil in the U.S. dropped 4.73 million barrels to 332.8 million last week, the Energy Department said Sept. 16. Those inventories are still “above the upper boundary of the average range for this time of year,” its report showed. Supplies of distillate fuel climbed 2.24 million barrels to 167.8 million, the highest since January 1983 and 24 percent more than the five-year average. Gasoline inventories rose 547,000 barrels to 207.7 million last week, the department said. Brent crude oil for November settlement traded at $71.50 a barrel on the London-based ICE Futures Europe exchange, down 5 cents at 1:02 p.m. Singapore time. The contract earlier fell as much as 45 cents, or 0.6 percent, to $71.10. Yesterday, it lost 12 cents to settle at $71.55. OPEC Shipments The Organization of Petroleum Exporting Countries will increase shipments by 0.9 percent in the four weeks ended Oct. 3, according to consultant Oil Movements. The 12-member group will raise exports by sea in the period to 22.57 million barrels a day, from 22.37 million in the month ended Sept. 3, the Halifax, England-based tanker tracker said in a report yesterday. OPEC agreed at its Sept. 9 meeting in Vienna to maintain production quotas at 24.845 million barrels a day. The 11 members governed by quotas, all except Iraq, produced 1.4 million barrels a day over the target in August, according to the International Energy Agency. To contact the reporter on this story: Christian Schmollinger in Singapore at

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