* U.S. gasoline stocks fell 4.4 mln barrels last week -EIA
* Technicals show oil to retrace to $81.41 []
* Coming Up: U.S. initial jobless claims; 1230 GMT
(Recasts with steady prices, adds U.S. GDP expectations)
By Alejandro Barbajosa
SINGAPORE, Oct 28 (Reuters) - Oil was steady on Thursday as
lingering doubts about the size of expected monetary stimulus
by the Federal Reserve capped the upside from a surprise drop
in U.S. gasoline stockpiles.
U.S. crude <CLc1> for December gained 4 cents to $81.98 a
barrel by 0643 GMT, after falling nearly 1 percent on
Wednesday, while ICE Brent <LCOc1> fell 3 cents to $83.20.
Oil prices on Thursday temporarily disconnected from the
dollar, which slid more than 0.5 percent against a basket of
currencies. <.DXY> The link between the greenback and crude
earlier this week was the strongest in 14 months.
Most leading economists expect the Federal Reserve to buy
between $80 billion and $100 billion worth of assets a month
under a new program to bolster the struggling U.S. economy, a
Reuters poll found on Wednesday. []
U.S. gasoline inventories fell by 4.4 million barrels last
week, the Energy Information Administration (EIA) reported on
Wednesday, dampening the bearish effect of
greater-than-expected gains in crude stockpiles of more than 5
million barrels.
"I see the decline in gasoline stocks as quite positive for
the oil market, especially because we don't usually see these
drops this time of year," said Ben Westmore, a commodities
analyst at National Australia Bank.
Still, "there is some talk in the market that the amount of
Fed QE won't be as big as previously expected," Westomore said,
referring to an injection of funds into the economy through
bond purchases in a process known as quantitative easing, or
QE.
UNCERTAINTY ABOUT STIMULUS
Estimates of how long the Fed will print money and how much
it will eventually spend varied widely, from $250 billion to as
high as $2 trillion in the Reuters survey of economists.
Participants deemed the impact of the asset buying could be
limited given that markets have already priced in the effect of
another big round of monetary stimulus.
Although U.S. oil demand jumped on a week-to-week basis,
total U.S. product demand fell 0.3 percent in the four weeks to
Oct. 22 from a year earlier, the EIA said, with gasoline use
down 0.8 percent in the period. []
"It's not an overly positive picture if you take some
trends over the past four weeks," Westmore said. "If you look
at the economic indicators, they continue to show the economy
is pretty sluggish."
Demand for a range of long-lasting U.S. manufactured goods
fell unexpectedly last month and a gauge of business spending
plans also dropped, underscoring the economic recovery's tepid
pace. []
The oil market's attention was also turning towards U.S.
GDP data to be released on Friday.
U.S. growth probably picked up modestly in the third
quarter to 2 percent from 1.7 percent in the prior quarter,
lifted by an acceleration in consumer spending, a Reuters poll
showed. []
The dollar rose while stocks and commodities fell on
Wednesday on doubts over how aggressively the Federal Reserve
would try to stimulate the flagging U.S. economy.
Investors had been pricing in large-scale bond purchases by
the Fed. That view lifted equities, commodities and emerging
market assets in recent weeks while the dollar fell because
more Fed injection of funds into the economy via quantitative
easing would lower the currency's value, at least in the short
term.
Oil will average more than $83 a barrel in 2011, a Reuters
poll showed, as expectations that a new round of U.S. monetary
stimulus would shore up the economy led analysts to raise
forecasts for the first time in six months. []
Most French oil refineries were set to start outbound
deliveries of fuel as work stoppages ended at two plants on
Wednesday, further easing a strike movement that has led to
pump shortages across France.
(Editing by Clarence Fernandez)
