Oil steady after mixed US inventory picture

SEOUL, May 3 (Reuters) Oil prices clawed back up today after US government data showed a build in crude but a further fall in gasoline stocks ahead of peak summer demand.

London Brent crude currently seen as more representative of global oil prices than the US crude, gained 18 cents to .43 a barrel by 0357 GMT, after dropping 75 cents on Wednesday. The US crude rose 4 cents to .72, after a 72-cent drop a day earlier.

US crude oil inventories rose by 1.1. million barrels last week in government data yesterday, slightly above analysts' forecasts, due in part to continued low demand from refiners amid a string of breakdowns.

''The data assured traders that there will be enough gasoline stocks for the peak season as refiners have enough crude to feed their refining rates for more products,'' said Hwang Ki-man, analyst at Korea National Oil Corp (KNOC).

But gasoline stocks continued to fall for the 12th consecutive week, down 1.1 million barrels, taking them about 15 per cent below levels in early February to their lowest since October 2005.

Gasoline futures in New York pulled back after gains in recent weeks that have supported crude oil prices, as a likely recovery in refinery operations in coming weeks could reverse the declines caused by plant shutdowns.

The US government said yesterday it will not buy crude to fill the nation's strategic reserve until at least the end of summer, further allaying concerns of oil being taken off the market just as refineries ramp up to meet demand.

Worries over European fuel supplies were also eased after Belgian oil sector unions and employers agreed a provisional pay deal yesterday, probably averting a strike that would have shut down the nation's oil refineries.

Brent prices are still up more than 9 per cent from the start of the year following OPEC production cuts and on worries over supplies from OPEC-producer Iran amid its nuclear dispute with the West.

OPEC President Mohammed al-Hamli told South Korean energy officials on yesterday that current oil prices were high and could be damaging for both producers and consumers.

But OPEC Secretary General Abdullah al-Badri said there was no need for OPEC to raise production this year.

A Reuters survey yesterday showed that OPEC, excluding Iraq and Angola, pumped 26.6 million barrels of crude per day in April, slightly less than March as members held the line on agreements to curb output.

REUTERS PM DS1217