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LONDON - Oil steadied on Thursday after crude stocks piled up in top consumer the United States and weighed on already well-supplied markets.
US crude edged down 6 cents to US$59.18 a barrel at 1827 GMT in thin electronic trade, with many dealers absent for the US Thanksgiving holiday.
London Brent crude fell 14 cents at US$59.41 after settling down 90 cents the previous day.
Prices topped US$60 this week after a halt in crude shipments at an Alaskan port, but were dragged down nearly US$1 on Wednesday by a surprise 5.1 million barrel rise in US crude inventories.
Analysts had expected only a slight, 600,000 barrel build.
"It was a shock announcement, and that really pushed the market down. The drawdown in distillate stocks was nothing too major," said Gerard Burg, a resource analyst at the National Australia Bank.
The US government's Energy Information Administration said distillate inventories fell by 1.2 million barrels. But the draw was concentrated in diesel, not heating oil, leaving stocks still above last year's levels ahead of peak winter demand.
Analysts are eyeing the possibility of further Opec output cuts, in addition to the 1.2 million barrel per day cut from November made by the producer group in an effort to stem falling prices.
"The sustainable floor is supported by the potential for further Opec cuts," Burg said.
But Qatar's Oil Minister Abdullah al-Attiyah said on Thursday oil price fluctuations in the past week made Opec's decision more difficult.
Attiyah last week told Reuters the exporter group had "no choice but to accept a cut" when it meets, echoing similar comments from other Opec ministers.
Prices have slid 24 per cent since hitting a record US$78.40 in mid-July, as bulging fuel stocks in consumer countries and doubts over Opec output cuts spurred investor selling.
Roy Mason of oil consultancy Oil Movements estimated Opec exports to rise 150,000 bpd in the four weeks to December 9, showing the group falling far short of its pledge.
"From these figures there isn't a cut in exports evident anywhere near the 1.2 million bpd promised by Opec," Mason said.
- REUTERS
