May 27 (Bloomberg) -- Crude oil rose, trading near $133 a barrel in New York, after a militant attack in Nigeria disrupted supplies from Africa's largest producer.

The Movement for the Emancipation of the Niger Delta, Nigeria's main militant group, said it attacked a crude-oil pumping station yesterday operated by Royal Dutch Shell Plc. India will take a decision soon on whether to raise fuel prices, Oil Ministry spokesman S. Sundareshan said today.

``The reports of more production being lost in Nigeria is giving support to a market that was already in an uptrend because of bulk buying in places like China, the dollar, and limited OPEC supply,'' said Robert Montefusco, a broker at Sucden (U.K.) Ltd. in London.

Crude oil for July delivery rose as much as $1.46 a barrel, or 1.1 percent, to $133.65 a barrel on the New York Mercantile Exchange from the May 23 close. Prices were at $133.09 at 1:12 p.m. London time.

Floor trading was shut yesterday for Memorial Day and electronic transactions were booked for settlement today.

Brent crude oil for July settlement gained for a third day, climbing as much as $1.04 cents, or 0.8 percent, to $133.41 a barrel, on London's ICE Futures Europe exchange. It was at $132.59 a barrel at 1:13 p.m. London time.

The contract gained 80 cents, or 0.6 percent, to $133.16 a barrel yesterday.

Dollar Decline

Iran cut oil exports by about 200,000 barrels a day between April 20 and May 20 because of a seasonal fall in demand, and doesn't intend to make further reductions, state-run Mehr news agency reported, citing National Iranian Oil Co. official Hojatollah Ghanimifard.

New York oil futures have increased 24 percent in the past two months and reached a record $135.09 on May 22 after the dollar posted its biggest weekly decline against the euro since March. A weaker dollar prompts investors to buy commodities as a hedge against inflation.

Nigeria, Africa's biggest producer, is now OPEC's eighth- largest member by output after attacks by militants this year halted as much as 164,000 barrels of Shell's daily output.

Some production has been lost after an attack on the Nembe Creek trunk line in Nigeria's Rivers State, Caroline Wittgen, Shell's spokeswoman, said yesterday. The attack was timed to protest the one-year anniversary of President Umaru Yar'Adua's administration, MEND said in an e-mailed statement.

Fuel Subsidies

``Any demand decrease out of the U.S. is immediately eclipsed by anything out of the Asian region right now and that has everything to do with subsidies,'' said Jonathan Kornafel, a director for Asia at Hudson Capital Energy in Singapore.

China Petroleum & Chemical Corp., Asia's largest refiner, known as Sinopec, was paid about 7 billion yuan ($1 billion) in subsidies in April, according to a company official.

Asian demand may increase 729,000 barrels a day, or 2.9 percent, this year, the largest gain globally, the International Energy Agency said May 13.

India, which caps fuel prices to limit inflation, will decide whether to increase prices, rationalize duties or increase the number of bonds given to refiners, the oil ministry's Sundareshan said.

The U.S. Department of Energy will release its weekly oil inventory report on May 29, a day later than normal because of the Memorial Day vacation.

``We're expecting a relatively large drop in gasoline supplies, and then probably looking at crude oil with a small drop of maybe 1 to 2 million barrels,'' said James Cordier, president of Liberty Trading Group in Florida. ``Anything more than that and we'll definitely test the $135'' record.

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net

Last Updated: May 27, 2008 08:14 EDT