Oil below $80 on U.S. crude stock build, firmer dlr

                                
 * Oil weakens after overnight surge as dollar recovers
 * Higher U.S. crude stocks counter gasoline draw
                                
 * Peak summer driving season could lead to large stock draw
                                
 By Seng Li Peng
                                
 SINGAPORE, Feb 25 (Reuters) - Oil edged down below $80 on
Thursday, after surging a day earlier, as the dollar recovered
and the euro slid, while the surprise rise in U.S. crude stocks
offset the fall on gasoline ahead of the driving season.
                                
 The euro fell to a one-year low against the yen and was
down versus the dollar on nagging fears over Greece's fiscal
woes, while the dollar's trade-weighted index recovered.
                                
 This countered the dollar's weakness versus the yen and the
commodities-linked Australian dollar after Federal Reserve
chief Ben Bernanke said on Wednesday interest rates will stay
low in view of a weak job market and low inflation.
                                
 "Comments from Bernanke reiterated the fact the interest
rates will remain low, and demand will therefore stay high,"
said Jonathan Barratt, managing director of Commodity Broking
Services.
                                
 U.S. crude for April delivery <CLc1> fell 15 cents to
$79.86 a barrel at 0356 GMT, after rising by $1 on Wednesday.
London Brent crude <LCOc1> lost 5 cents to $78.04 a barrel.
                                
 Bernanke's testimony on Wednesday to Congress calmed
investors' concerns over interest rate after the Fed said last
week that discount rates will be raised to 0.75 percent from
0.5 percent, triggering an immediate rise in the dollar.
                                
 U.S. crude oil stockpiles rose by 3 million barrels to
337.5 million barrels in week ended Feb. 19 week, data from the
Energy Information Agency show, countering industry group
American Petroleum Institute's (API) figures on Tuesday showing
a large crude inventory fall. [ID:nN24230774].
                                
 U.S. gasoline inventories fell 900,000 barrels to 231.2
million barrels, versus analysts estimates of a 400,000-barrel
build. [EIA/S]
                                
 "The build is a result related to summer drive time. There
are expectations that (gasoline) supplies won't be enough."
                                
 U.S. refiners normally start stockpiling in April for the
start of the driving season in end-May and peaks in June-July.
                                
 China imported 17.1 million tonnes of crude in January, up
nearly 33.4 percent from a year ago, official data showed.
 "The market appears to be U.S.-centric ...but one hard
evidence is the demand we are getting from China, where it has
continued to grow," said Barratt.
                                
 Operating rates in Chinese refineries have been high, with
30.14 million crude processed in January, or 7.1 million
barrels per day (bpd), up 29 percent from a year ago, the China
Petroleum and Chemical Industry Association (CPIA) said.
 (Editing by Ramthan Hussain) ((lipeng.seng@thomsonreuters.com;
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