Oil steady around $73 ahead of inventory data

TOKYO, Aug 16 (Reuters) U.S. oil prices were little changed around a barrel on Wednesday as a truce between Israel and Hizbollah entered its third day and traders looked ahead toward an expected decline in U.S. crude and gasoline stockpiles.

U.S. light, sweet crude for September delivery was trading down 4 cents at .01 a barrel by 0505 GMT. Prices fell for the third-straight session on Wednesday and are near Monday's .60 intra-day low, the weakest since July 20.

ICE Brent crude was trading 3 cents higher at .83 a barrel. On Tuesday, it fell 50 cents.

Prices have slumped from above a barrel a week ago after BP said it would shut down only half of its 400,000 barrel per day (bpd) Prudhoe Bay oilfield in Alaska and the United Nations brokered a truce to end a month-long war in the Middle East.

Israeli forces began leaving parts of south Lebanon on Tuesday as the ceasefire held into a third day. The United Nations hopes to start deployment of a new U.N. force in Lebanon with some 3,500 troops within two weeks to monitor the fragile truce, provided France forms the backbone for the contingent.

''Oil prices have come down now that the previously supportive factors of Israel-Hizbollah and Prudhoe Bay are out of the picture,'' said Naohiro Niimura, head of research and sales at Mizuho Corporate Bank.

The focus will turn later on Wednesday to U.S. oil data, with weekly inventory statistics expected to show a 1.8 million-barrel decline in gasoline stocks due to strong demand in the last weeks of the summer driving season, which ends with the Labor Day holiday weekend in early September.

Crude stocks were likely to have dropped by 1.6 million barrels and distillate stocks to have risen by 500,000 barrels, an expanded Reuters survey of 14 analysts found. S] Attacks against foreign oil workers in Nigeria and Iran's stand-off with the West over its nuclear development are also lending support to prices, which are still up nearly 20 percent this year, aided by healthy investor buying.

U.S. consumer price inflation data due at 1230 GMT may provide another trigger for an influx of funds. The core index likely climbed 0.3 percent in July from a month earlier, matching June's rise, a Reuters poll of economists showed.

''If the CPI data turns out to be weak and supports projections of no interest rate hike in the United States in September, new funds are likely to flow to oil because fundamentals are strong,'' said Mizuho's Niimura.

REUTERS SRS KP1210