SINGAPORE, Jan 5 (Reuters): Oil held steady today as dealers waited to see if an expected draw on US commercial crude oil stocks would help extend a five-day rally.
US February light crude eased 12 cents to $63.30 a barrel, still holding most of the $5-plus gains it has racked up since last week as fresh investor funds stream into the market.
London Brent crude slipped 13 cents to $61.55.
With a row between Russia and Ukraine over natural gas supplies now resolved, traders will focus on US government stock data expected to show a decline in crude stocks but a rise in product inventories later in the day.
Russia and its former Soviet neighbour agreed to a five-year gas supply deal Wednesday after a row over prices that had temporarily disrupted supplies to an anxious Europe, which depends on the giant producer for a quarter of its gas.
That news initially took prices nearly $1 lower Wednesday, but a commodity-wide flush of fund money and forecasts for a decline in crude stocks helped the market close 28 cents higher.
Crude oil prices have gained more than $5 a barrel or about 8.8 per cent over the past five trading days as investors, keen to boost exposure to a market that has surged by more than a third for two years in a row, plough new money into the market.
US stocks data later Thursday will provide fresh direction, with analysts forecasting a decline of 1.2 million barrels in crude stocks for the week to Dec. 30 due to lower imports and year-end tax-related inventory liquidation.
Although milder winter temperatures probably helped distillate stocks rise 700,000 barrels last week, gasoline inventories were only expected to rise 400,000 barrels, keeping them in a substantial deficit versus the year- ago level.
Analysts said that tight supplies and an anticipated heavy US refinery maintenance schedule might heighten concerns over gasoline supplies, which were stretched thin late last summer after hurricane-related outages in the Gulf Coast.
US refineries have been running at close to full capacity to boost winter fuel supplies and top up gasoline stocks, with some postponing planned maintenance until this year.
February gasoline futures dipped 0.67 per cent to $1.7725 a gallon in early Thursday trade. Its premium to crude surged up 90 cents Wednesday, nearing last week's 11-week high and reflecting the supply tightness.