Crude oil falls as worries about refinery capacity are soothed on rising output.

May crude iol futures slipped $0.34 to $53.77 a barrel.

On April 6 the US government report indicated a 5.2 percent jump in refinery production last week, stating that refineries operate at 93.7 percent capacity, the record level in the past three years. This alleviated concerns about peaking U.S. gasoline demand in the driving season between the Memorial Day holiday late May and the Labor Day holiday early September.

The International Monetary Fund issued its its semi-annual World Economic Outlook on Thursday where it predicted that the oil price can rise to $100 a barrel in the period through 2030 on risig global demand, in particular from China.

"In short, it will continue to be a rocky ride going forward, with a wide band of uncertainty surrounding high expected prices," said Raghuram Rajan, the IMF’s chief economist.

The fund’s economists cite meagre spare production capacity that has declined to about 1.5 million barrels a day from more than 5 million barrels in 2002.

The EIA report forecasts that US gas prices will keep growing, averaging $2.28 a gallon for the summer, 20% above last year’s levels. The reasons for the rise are sustained high demand and lack of US refining capacity. "The main factor behind the rise in gasoline prices is the increasing domestic consumption over the global increase in crude-oil prices," said Guy Caruso, administrator of the Energy Information Administration.