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SINGAPORE, Oct 12 (Reuters): Oil moved higher today, rebounding from heavy losses last week on concerns over tight supplies ahead of winter and after the International Energy Agency (IEA) forecast faster demand growth next year.
US crude oil futures edged up 17 cents to $63.70 a barrel, adding to the previous day's 2.8 per cent rally from a 10-week low of $60.35 Monday. Oil had slid from an Aug. 30 peak of $70.85 after an emergency oil stocks release by the IEA and on worries over weaker demand, after signs that high oil prices were taking a toll on major consumers.
The IEA, an adviser to 26 industrialised nations, trimmed its forecast for 2005's demand growth to 1.26 million barrels per day (bpd) after hurricanes knocked out US rigs and sent fuel prices to record peaks.
But it said demand growth would rebound to 1.75 million bpd next year after the largely temporary impact of hurricanes Katrina and Rita and on a recovery in Chinese demand.
Analysts said if demand in the world's largest consumer remained healthy into the fourth-quarter, concerns over US winter fuel supplies would become the focus of the market.
Analysts said US government stock data due Thursday is likely to give a clearer picture on whether fuel stocks would be sufficient for winter.
Seven US refineries remained completely shut Tuesday in the wake of hurricanes Katrina and Rita, amounting to just under 2 million barrels per day (bpd) or 11 per cent of US capacity, the latest Reuters survey of oil companies found.
Some analysts said signs of an improving US economy, such as smaller-than-expected job loss data for September, backed a healthy US demand picture.
"The hurricanes which battered the US Gulf Coast did not have the impact on the labour market as was earlier expected," said Dariusz Kowalczyk, a Hong Kong-based senior investment strategist at CFC Seymour Securities.
"The US economy is driven by consumer spending, so if more people are working the economy will drive better."
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