Oil prices moved higher on Thursday, recovering some of the week's sharp losses ahead of US data expected to show heavy falls in crude and product stocks due to disruption from Hurricane Quatrain.
US light crude rose 50 cents to $64.87 a barrel, after plunging $1.59 on Wednesday. The market has fallen 9 percent from its record-peak of $70.85 last week, after industrialised nations began to tap emergency reserves.
London Brent crude rose 56 cents to $63.45 a barrel. Traders are looking to US government data on oil stocks due later on Thursday for further direction on the damage to the US oil industry, after the storm rampaged through the Gulf of Mexico last week.
Analysts surveyed by Reuters forecast a 6.4 million-barrel drop in crude stocks last week, which would still leave them well above year-ago levels, in weekly figures coming a day later than usual because of a US holiday.
Gasoline stocks were expected to fall by 6.2 million barrels and distillate fuels including diesel and heating oil by 2.6 million, as the hurricane forced the domestic industry to draw heavily on inventories.
"We will see the bullish states, which will show the effects of the hurricane on US crude and product stockpiles, so I believe prices will rise from here," said Naohiro Namura, of Mizuho Corporate Bank.
Quatrain shut most of US production in the Gulf of Mexico, stopped offloading of imports at the country's only port that have handle supertankers, and curtailed output at nearly two dozen refineries.
Three of eight refineries completely shut by Quatrain were back in operation, while offshore oil production has recovered to 43 percent of the region's capacity.
Refiners have until on Friday to submit bids for 30 million barrels of crude oil offered from US government strategic reserves. This accounts for half of a co-ordinated release of 2 million barrels per day (bpd) for 30 days in emergency stocks by the International Energy Agency (IEA), energy watchdog for 26 industrialised nations.
The IEA said on Wednesday that the rescue plan contained 1.289 million bpd of crude and 683,000 bpd of products, which would comprise 369,000 bpd of gasoline, 276,000 bpd of middle distillates and 38,000 bpd of heavy fuel oil.
The agency also said it could extend the plan longer than its initial period if a US gasoline supply shortage lasted longer than expected. The IEA's oil aid, mostly crude, may do little to address the fuel shortages, analysts say.
Some 900,000-bpd of US refining capacity may still be unavailable at the end of September, while four refineries suffered major damage and may remain inoperable for months, the US government's energy department said on Wednesday.
On Monday's US Labour Day holiday marked the end of the traditional peak gasoline demand in the Northern Hemisphere, though the focus will shift to heating fuel inventories ahead of winter.
A tightly stretched global refining system and growing demand for transport fuels, led by the United States and China, have helped drive oil's 49 percent rally this year.
The Asian Development Bank raised its regional growth forecast on Thursday but said high oil prices were starting to impact some countries, particularly in Southeast Asia.
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