Oil under $82, snaps 9-day rise on US stock build

                                
   * Awaits EIA inventory report due later
                                
 * US economic data due later could confirm rebound
                                
 * Cold weather-driven price rally seen continuing
                                
 By Jennifer Tan
                                
 SINGAPORE, Jan 6 (Reuters) - Oil eased to below $82 a
barrel on Wednesday, snapping a nine-day winning streak, after
industry data showed a surprise rise in U.S. distillate
inventories last week even though heating oil supplies fell.
                                
 Cold weather in the United States, Europe and parts of Asia
boosted demand for heating fuel, pushing crude to its highest
settlement in nearly 15 months on Tuesday.
                                
 But sentiment was dented after data from the American
Petroleum Institute (API), released after the close, showed
U.S. distillate supplies rose 962,000 barrels last week,
against expectations for a 1.9 million barrel drop. [API/S]
                                
 The market is eyeing weekly inventory data from the Energy
Information Administration (EIA), due later in the day, for
further clues on the outlook for demand from the world's top
energy user.
                                
 U.S. employment data and a gauge of December
non-manufacturing activity, also scheduled for release on
Wednesday, could confirm that the world's largest economy is on
the road to recovery, albeit a patchy one. [ECI/US]
                                
 U.S. crude for February delivery <CLc1> fell 19 cents to
$81.58 a barrel by 0240 GMT, after settling up 26 cents on
Tuesday at $81.77, its highest settlement since early October
2008.
                                
 London Brent crude <LCOc1> eased 12 cents to $80.47.
                                
 "The market's biggest worry right now is the U.S. inventory
levels, but overall, I think the firm tone can be sustained,
and we should see a range of $75-$85 in the near term," said
Keiichi Sano, general manager of research at SCM Securities in
Tokyo.
                                
 "The rally has been driven by cold weather, and this will
continue for the next one to two weeks. We're seeing covering
of speculative short positions after the cold snap set in."
                                
 Frigid temperatures in the United States were expected to
boost the country's heating demand to 21 percent above normal,
with consumption in the U.S. Northeast -- the largest heating
oil market -- seen 11 percent above average levels.
[ID:nN04235377]
                                
 Freezing temperatures in Britain are expected to continue
into the second half of January after the coldest December
since 1995, while colder temperatures in Europe are seen
gradually spreading from the northeast to the southwest over
the next few days. [ID:nLDE6031DH]
                                
 API data unveiled on Tuesday showed U.S. heating oil
stocks, a major part of distillates, fell 1.3 million barrels
for the week to Jan. 1, while crude stocks fell a
larger-than-expected 2.3 million barrels. Gasoline inventories,
however, jumped 5.6 million barrels.
                                
 Investors are also watching for further developments
between Russia and Belarus after an oil dispute saw Russia
briefly cut off supplies to the Eastern European nation.
                                
 Belarus sent a delegation to Moscow on Tuesday for talks to
resolve the dispute that has raised the spectre of winter
supply problems for the European Union. [ID:nLDE6041IK]
[ID:nLDE604052]
 (Editing by Himani Sarkar)