US oil prices were higher on Thursday, supported by the stoppage to Iraqi exports after a series of sabotage strikes on key pipelines and a drop in US gasoline stocks as peak summer demand approached.
US light crude climbed 21 cents to $37.53 a barrel, almost $5 off the 21-year peak on June 2 at $42.45 just before the Opec producers' group announced it would pour more oil into the market to cool red-hot prices.
Brokers said the market looked fragile and lower prices were expected, although this week's attacks on Iraqi oil infrastructure had slowed the slide. "The momentum has been downwards towards $36 or $35 a barrel, but the Iraq stoppage and now the US data has probably put a brake on any fall," said Tony Nunan, manager at Mitsubishi Corp's international petroleum business in Tokyo.
"There's still a floor to the market because of Middle East uncertainty and Opec pumping almost at peak to keep the market supplied," Nunan said.
Iraq's 1.6-1.7 million barrels of daily crude exports remained shut off on Thursday following attacks that damaged pipelines running to the southern oil terminals, Basra and Khor al-Amway. It was uncertain when exports would resume.
Crude flows from the northern Kirkuk oilfields are also halted after pipeline sabotage on Tuesday.
Traders also fear a potential strike on oil facilities in Saudi Arabia, the world's top exporter which has seen a wave of Muslim militant violence this year aimed at ousting the ruling royal family and driving out Westerners.
Saudi Arabia has pledged to supply more than nine million barrels a day (bpd) to the world's 81 million-bpd market in June to ease worries of tight supplies at a time when robust global economic growth in 2004 has fuelled the biggest increase in oil demand in 24 years.
The Organisation of the Petroleum Exporting Countries agreed this month to increase formal supply limits by two million bpd from July 1 and by another 500,000 from August 1 to stop this year's run up in oil prices.
The bigger Opec volumes, estimated at 800,000 bpd in June ahead of the formal increase in supply limits, have helped push down prices from the peaks two weeks ago.
The US government said on Wednesday that commercial crude stocks rose for the second week in a row to almost 303 million barrels, the highest inventory level in two years although tanks remained nine million barrels below the five-year average for the time of year.
The 800,000-barrel crude rise was below market forecasts of a 1.55-million-barrel build.
The latest data from the Energy Information Administration (EIA) for the week ending June 11 also saw US gasoline stocks fall by 500,000 barrels, against predictions of an increase of 1.4 million barrels.
US gasoline demand peaks in summer months and inventories are 1.6 million barrels below year-ago levels, the EIA said. US unleaded gasoline futures were trading flat on Thursday at $1.1462 a gallon.
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