LONDON, Nov 9 (Reuters) Oil dipped below a barrel on Friday, but was still within reach of the 0 milestone, supported by supply disruptions ahead of peak winter demand and the dollar's dip to new lows.
U.S. crude fell 49 cents to .97 a barrel by 1256 GMT, off early-session highs of .48.
London Brent crude slipped 65 cents to .14.
Oil has fallen for three days in a row from a record .62 a barrel reached on Wednesday, pressured by concerns over the economic health of top consumer the United States after Federal Reserve Chairman Ben Bernanke highlighted the twin threats of slower growth and inflation.
But tighter supplies ahead of winter and investment flows into commodities are providing support.
''Commodity markets should be able to hold their own in days ahead, as they will need to see evidence of a demand slowdown before they correct themselves,'' said Edward Meir of MF Global.
''In energy's case, we seem to be regrouping...as we attempt yet again to take out the 0 mark on crude.'' The weak dollar, which has helped boost the oil price, hit record lows against the euro on Friday as Bernanke's comments increased expectations of another cut in U.S. interest rates.
The dollar's slide has helped maintain the allure of crude for financial investors and speculators who have helped lift oil by 40 percent since mid-August.
''Investments in commodities continue to grow,'' said a Bank of America research note.
''With the latest estimates putting the total capital tracking commodity indexes at 0 billion.'' The fundamental supply/demand picture for oil is also still supportive of prices.
''U.S. crude oil inventories have continued to fall counter-seasonally,'' Barclays Capital said.
''The seasonal swing in demand will put further pressure on stocks,'' said. ''Even if OPEC raises production further in December, the effect of the increase will not be felt in consuming regions until well into the first quarter of 2008.'' At least nine oil and gas platforms in the Norwegian part of the North Sea had shut due to a storm overnight on Thursday, but operators but fields were restarting on Friday.
REUTERS BJR KP1847