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LONDON, Sep 21 (Reuters) Oil prices edged higher on Thursday after hitting six-month lows the previous session, but big U.S. fuel stocks and hopes talks with Iran could avert a crisis over its nuclear programme weighed on sentiment.

U.S. light crude was trading 31 cents higher at $61.05 a barrel, while London Brent crude was up 21 cents at $60.68 by 1115 GMT.

On Wednesday, the expiring front-month U.S. contract touched a low of $59.80 before settling at $60.46, its lowest settlement since March 20, and around $18 below the U.S. record of $78.40 hit in July.

The price fall is the sharpest in 15 years and has increased expectations the Organization of the Petroleum Exporting Countries might act to curb supplies although opinion is divided on the price level that would trigger an output cut.

''The trends toward $60 are clear and strong. Since we are only $1 away, there is a good chance that prices will move below $60,'' said Mike Wittner of Calyon investment bank.

He predicted support would come as Asia would probably absorb some of the surplus of available crude, but if that did not happen quickly enough, OPEC would cut supplies.

Technical analysts, who study charts of past prices for clues to future direction, said a convincing break below $60 could lead to a fall to around the $55 region, although strong resistance around $58-$60 could halt the slide.

In Vienna last week, OPEC left existing output unchanged, but said it could call an emergency meeting before its next scheduled meeting in December if considered necessary.

Saudi Oil Minister Ali al-Naimi said on Tuesday current prices were reasonable and were not having a big negative impact on global economic growth.

This was the first time Naimi had described the prices as reasonable since the fall from July's peak.

BIG FUEL STOCKS Wednesday's price slide drew momentum from news that ahead of winter in the northern hemisphere, U.S. distillate inventories, which include heating oil, had risen to their highest level since January 1999.

An apparent easing in the crisis over OPEC producer Iran's uranium enrichment programme also put downward pressure on oil prices.

Iranian President Mahmoud Ahmadinejad on Wednesday signalled a willingness to negotiate after major powers said Tehran had until early October to suspend its nuclear programme.

The outbreak of bearish sentiment has coincided with a sharp sell-off by hedge funds and some high-profile losses.

Amaranth Advisors LLC, a Connecticut hedge fund that lost billions of dollars in natural gas trades, on Wednesday took steps to disband.

Its collapse has helped to focus attention on natural gas as well as oil. Crude traders said they would be monitoring Thursday's government data on U.S. natural gas storage.

U.S. natural gas storage levels were expected to rise by about 90 billion cubic feet, according to a Reuters survey of industry sources.

REUTERS PKS PM2017