LONDON, Feb 1 Oil retreated slightly on Thursday but stayed in sight of $ 58 as a cold sn

LONDON, Feb 1 (Reuters) Oil retreated slightly on Thursday but stayed in sight of $58 as a cold snap in top consumer the United States stoked heating fuel demand and the latest OPEC production cuts took effect.

U.S. oil jumped $1.17 the previous session, taking gains for the week to over 4 percent. It slipped on Thursday, with U.S.

crude down 27 cents at $57.87 a barrel by 1037 GMT and London Brent crude 23 cents lower at $57.17.

Prices have rebounded from a 20-month low of $49.90 on January 18 as cold weather -- albeit late in the northern winter season -- helped to draw down U.S. distillate fuel stocks for the first time in nearly two months.

''We are getting some (investment) funds coming back now as there is enough strength in the market,'' said Gerard Burg, an analyst at National Australia Bank.

Data published on Wednesday showed U.S. heating oil stocks dropped 3.4 million barrels last week. The National Weather Service has forecast below normal temperatures in the next two weeks, suggesting demand will stay strong.

OPEC's latest production cut, of 500,000 barrels per day, took effect on Thursday.

The reduction is in addition to a 1.2 million bpd cut from November agreed by the group that pumps over a third of the world's oil. Together they should trim OPEC supplies by around six percent.

The strength of the U.S. economy is central to the demand picture. The nation's output expanded at a robust 3.5 percent annual rate in the fourth quarter.

But BNP Paribas analysts noted Wednesday's U.S. oil stocks data showed a 800,000 barrels rise in diesel stocks, which could be a sign of slowing economic growth.

''The diesel numbers.. are tied to economic activity (diesel is used in rail and trucking of merchandise). (They) have been trending above their five-year range since the beginning of the year. The accumulation of inventory can be a precursor sign.'' REUTERS CS DS1640