NEW YORK (CNNMoney.com) -- Oil prices fell back near $67 a barrel Thursday after oil giant BP said its Prudhoe Bay facility in Alaska could reach full capacity by next month.

U.S. light sweet crude for October delivery fell 18 cents to settle at $67.32 a barrel. Earlier in the session crude hit $66.76, a five-month low, on the news.

Execs from BP, testifying before a Congressional committee Thursday on the failure of its failed Prudhoe Bay pipeline facility in Alaska, said the pipeline could be up and running by the end of October.

The pipeline, which generates 400,000 barrels of oil a day, or about 8 percent of the country's domestic oil production, when fully operational, was shuttered in August after inspections revealed signs of corrosion.

Execs, including BP America Chairman Bob Malone, admitted to the company's failure.

"BP's operating failures are unacceptable," Malone told members of a House panel. "They have fallen short of what the American people expect of BP and they have fallen short of what we expect of ourselves."

Crude prices had slipped earlier in the session after the Energy Information Administration reported a surprising jump in gasoline inventories.

Total motor gasoline inventories rose by 700,000 barrels last week, putting them above the upper end of the average range. Gasoline inventories were expected to fall 800,000 barrels last week, according to a Reuters survey.

Over the last four weeks, motor gasoline demand has averaged nearly 9.6 million barrels per day, or 1.4 percent above the same period last year, according to the report.

Crude oil inventories fell 2.2 million barrels last week, versus forecasts for a decline of 1.3 million barrels according to Reuters. At 330.6 million barrels, U.S. crude oil inventories remain well above the upper end of the average range for this time of year.

Oil prices have eased from their record trading high of $78.40 set in July following a cease-fire between Israel and Hezbollah.

While crude prices have been driven lower by the end of the U.S. summer driving season, signs of slowing global economic growth and a seemingly innocuous hurricane season, not all analysts are convinced that the decline will continue indefinitely.

"I think a lot of it [crude] is already discounted," says Brian Hicks, co-manager of the Global Resources Fund at U.S. Global Investors in San Antonio, who has oil trading between $65 and $75. "Even if we were to go below $65 and perhaps as low as $60 we don't think it would be that way for too long since we would see pick up in demand."

Right now oil prices are continuing to receive support from the standoff between Iran and world powers over its nuclear enrichment program.

The country rejected calls by members of the United Nations Security Council to end the program by August 31, and now possibly faces sanctions as a result.

Next week OPEC is scheduled to meet in Vienna next week, but the oil cartel is widely expected to leave production levels untouched. Some analysts however are speculating that production cuts could be forthcoming if crude prices remain at their current level.

--from staff and wire reports

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