* Japan Q3 growth supports oil early Monday, US data mixed
* Tight NY Harbor stocks lift US gasoline, crude futures
* Dollar strength helps limit oil bounce
* Coming up: CFTC positions data, 3:30 p.m. EST Monday
(Recasts, updates prices and market activity, new byline and
changes dateline from previous LONDON)
By Robert Gibbons
NEW YORK, Nov 15 (Reuters) - U.S. oil prices edged up on
Monday, bouncing on expectations demand will firm after sliding
sharply from a 25-month peak last week on concerns China may
act to cool inflation and on continuing worries about Europe's
economy and euro zone debt.
In addition to a bounce after Friday's slide, analysts
cited supportive news on Japan's third-quarter growth and
strong U.S. gasoline futures amid tight stocks in the New York
area as factors lifting the oil complex.
But the dollar's strength and caution about a possible
interest rate hike in China to cool inflation helped curb the
rise by crude oil prices, analysts said.
"Crude is trying to rebound after the drop on Friday, but
the stronger dollar is limiting the bounce as are concerns
about Europe and their effect on demand," said Phil Flynn,
analyst at PFGBest Research in Chicago.
U.S. crude for December delivery <CLc1> rose 30 cents, or
0.35 percent, to $85.18 a barrel at 12:48 p.m. EST (1748 GMT).
In London, ICE expiring December Brent crude <LCOc1> rose
48 cents to $86.82 a barrel.
U.S. gasoline futures rose 2.36 cents, or 1.07 percent, to
$2.2335 per gallon.
Gasoline inventories in the New York Harbor region, the
delivery point for U.S. gasoline futures, remain tight.
Stocks have fallen as the "result of an exceptionally heavy
slate of east coast refinery maintenance and the labor related
curtailment of French refinery activity that has curtailed U.S.
imports," Jim Ritterbusch, president at Ritterbusch &
Associates, said in a research note.
Early support for oil came from news Japan's economic
growth accelerated in the third quarter as expiring government
incentives boosted consumption before an anticipated slowdown
on damage to exports from the strong yen. []
U.S. retail sales rose in October, posting their largest
gain in seven months, but that upbeat Commerce Department
report was tempered by news that a manufacturing gauge in New
York state fell this month to its lowest level since April
2009. []
The dollar index <.DXY> hit a six-week high as rising U.S.
bond yields boosted the appeal of U.S. assets and worries about
Ireland's debt crisis persisted. []
A stronger dollar can weigh on oil prices because it
attracts investors away from dollar-denominated oil and
increases the value of greenbacks paid to producers and makes
oil more expensive for users of other currencies.
PULLBACK
Amrita Sen, commodities analyst at Barclays Capital, said
the recent oil price drop was exaggerated and the steep fall
was not justified by demand data.
The IEA on Friday raised its 2010 oil demand growth
forecast from its previous report on expectations of stronger
demand in both China and industrialized economies. []
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For a graphic on 2011 and historical demand forecasts:
http://link.reuters.com/zyv25q
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The U.S. Federal Reserve stimulus plan to buy $600 billion
in Treasury bonds to boost tepid economic growth was expected
to support oil demand and weaken the dollar.
Though China's crude oil imports surged to a record high in
October, an accompanying surge in inflation had oil investors
wary of interest rate hikes and more boosts to bank reserve
requirements likely to ensue to cool an overheated economy.
Last week the People's Bank of China surprised the market
by auctioning one-year bills in its open market operations at a
higher yield than the previous week, with traders saying the
move may mean that Beijing could tighten monetary policy to
ward off too much liquidity in the system. []
(Additional reporting by Emma Farge and Isabel Coles in
London, and Rebekah Kebede in Perth; Editing by David
Gregorio)
