* Brent down about half percent, U.S. crude 1 pct lower
* Crude prices lost about 10 pct past 2 weeks
* Oil prices risk falling again in spring - Goldman
* Product cargoes queuing outside European ports
(New throughout, updating market activity and prices to U.S.
session; changes byline and previous LONDON dateline)
By Barani Krishnan
NEW YORK, Oct 26 (Reuters) - Crude prices edged lower on
Monday, staying under pressure after two straight weeks of
losses, on worries that the oversupply in oil products could
swell from unseasonably warm weather and the waning maintenance
cycle for U.S. refineries.
Influential Wall Street trading house Goldman Sachs (N:GS) warned
of downside risk for oil prices through spring 2016 as U.S. and
European storage utilization for distillates, which include
diesel, neared historic highs. urn:newsml:reuters.com:*:nL3N12Q256
Traders told Reuters that as refined oil product storage
tanks fill up, unwanted diesel and jet fuel cargoes were backing
up outside Europe's ports and taking longer, slower routes
around the southern tip of Africa. urn:newsml:reuters.com:*:nL8N12N365
"There's talk in the market about ULSD (ultra low sulfur
diesel) storage potentially reaching 'tank tops', and that's
weighing on crude," said Dave Thompson of Washington-based
broker Powerhouse.
Brent LCOc1 , the global benchmark for crude, was down 20
cents, or 0.4 percent, at $47.79 a barrel by 11:28 a.m. EDT
(1528 GMT). U.S. crude futures CLc1 fell 43 cents, or about 1
percent, to $44.17.
ULSD futures HOc1 in the U.S. and gas oil in London
LGOc1 were also down about 1 percent.
Both crude benchmarks have lost about 10 percent over the
past two weeks combined.
Goldman it would take 50 fewer heating degree days (HDDs)
than normal in Europe for storage there to hit tank tops.
HDDs are measured by the difference between the average
temperature outside and the 70 degrees Fahrenheit (21 degrees
Celsius) level, which is deemed to be neutral indoors for
heating. The lower the reading, the less energy products such as
heating oil and natural gas are expected to be required for
heating.
"While our distillate balances suggest that stocks will fall
short of capacity, the margins of error are small and the risks
high, leaving risks to current crude oil prices and timespreads
as skewed to the downside through next spring," analysts at
Goldman Sachs wrote.
Investments in oil are likely to decline further in 2016
after sliding this year by more than a fifth, Fatih Birol,
executive director of the International Energy Agency (IEA),
said. urn:newsml:reuters.com:*:nL3N12Q1A9
"If it comes true, this will be the first time in two
decades we will see oil investments declining for two
consecutive years and may be an indication for future oil
markets," Birol said at Singapore International Energy Week.
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Chart on Brent oil http://graphics.thomsonreuters.com/US/2/PVB_20152610091537.png
Chart on U.S. oil http://graphics.thomsonreuters.com/US/2/PVB_20152610090817.png
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