TOKYO -- Oil hovered at $61 on Friday as the market balanced growing U.S. crude stockpiles with concerns over heating fuel supply in the face of a looming winter and slow output recovery in the Gulf of Mexico, according to Reuters.
U.S. light crude edged up 8 cents to $61.17 a barrel after gaining 43 cents on Thursday. London Brent crude traded 6 cents up at $59.20 a barrel.
"Though there seems to be a lot of crude around, the long-term view is bullish," said Tony Nunan at Mitsubishi Corp. in Tokyo. "The U.S. Northeast [image-nocss] will get colder, and people may be concerned with middle distillate supplies."
Demand for distillate fuels such as heating oil peaks in the northern hemisphere's winter. Temperatures in the U.S. Northeast, the world's biggest heating-oil market, were expected to be 3 to 8 degrees Fahrenheit below normal until the weekend.
A rise in U.S. fuel demand could come while the recovery of oil and natural gas production from the storm-battered Gulf of Mexico -- home to more than a quarter of U.S. domestic output -- remains at a crawl.
Some 1.022 million barrels per day (bpd) or 68% of the Gulf's crude output stayed shut on Thursday, along with 5.559 billion cubic feet per day or nearly 56% of gas output, the U.S. government said, a thin improvement from Wednesday, according to the Reuters report.
Dampening hopes of an early recovery, the U.S. Interior Department said on Thursday that energy operations in the Gulf of Mexico would not return to normal until late March next year.
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