* Oil remains volatile, subject to exchange rate
fluctuations
* Technicals show oil to retrace to below $81
[]
* Coming Up: U.S. Fed Chairman Bernanke speech; 1215 GMT
By Alejandro Barbajosa
SINGAPORE, Oct 15 (Reuters) - Oil was steady on Friday,
heading for a third straight weekly close above $80, as
expectations of economic stimulus ahead of a speech by Fed
chief Ben Bernanke countered soft demand in top consumer the
United States.
U.S. crude for November <CLc1> rose 19 cents to $82.88 a
barrel at 0247 GMT, less than $2 from last week's five-month
peak of $84.43, while December ICE Brent <LCOc1> gained 15
cents to $84.35. November Brent expired on Thursday.
A drop in the dollar to 2010 lows on Thursday kept
commodities among investors' top picks, briefly sending oil
above $84, before government data showed U.S. gasoline
consumption fell 1.1 percent in the past four weeks from a year
earlier, while total oil demand rose just 0.8 percent.
"The near-term picture of the U.S. oil market remains
challenging," said Stefan Graber, a commodities analyst with
Credit Suisse in Singapore.
"We expect the range-trading theme in the oil market to
extend, with temporary setbacks below $80 still possible."
Oil prices broke out of this year's predominant $70 to $80
range last month as traders anticipated a fresh round of U.S.
Federal Reserve monetary easing that would boost growth
prospects and cut unemployment, but are now stalling around $80
to $85 a barrel as the market weighs immediate economic
conditions against future policy moves.
New claims for jobless benefits in the U.S. unexpectedly
rose last week, a report showed on Thursday, weighing on crude
prices even as the data bolstered the case for the central bank
to pump more money into the economy as soon as next month.
[]
OPEC STANDS PAT
The Organization of the Petroleum Exporting Countries on
Thursday kept intact a supply policy that has served it well
for nearly two years and set aside concerns a weak dollar could
drive the oil price too high for a fragile world economy.
"The biggest challenge we have is to keep the oil market as
it is today," Saudi Arabian Oil Minister Ali al-Naimi told
reporters, indicating his satisfaction with current prices.
[]
U.S. crude inventories dipped by 416,000 barrels last week,
the U.S. Energy Information Administration said on Thursday,
far below the 4.1-million-barrel drawdown reported by the
American Petroleum Institute on Wednesday, but against a
Reuters poll forecast for a 1.1-million-barrel increase.
Gasoline stocks fell by 1.8 million barrels, more than
expected, while distillate supplies, which include heating oil
and diesel, dropped by 255,000 barrels, less than forecast.
"The inventory drawdowns in crude oil and oil products look
constructive at first glance," Graber said.
"However, stockpiles fell because of sharply lower imports
and an unexpected drop in refinery utilisation and not because
of improved U.S. oil demand, which remains soft."
The oil market was awaiting Friday's U.S. government data
on consumer prices and retail sales in September and a
preliminary reading of consumer sentiment so far this month.
Also on Friday, Fed Chairman Ben Bernanke will give a
speech in Boston that could provide clues on what monetary
authorities are planning to do next.
A strike at Fos Lavera port in France entered its 18th day
on Thursday -- the longest at the key Mediterranean oil port --
while workers at most refineries were also on strike as part of
stoppages across the country that began on Tuesday over
government pension reforms. []
The dollar edged higher on Friday, pulling away from a
10-month low hit against a basket of currencies the previous
day as investors trimmed greenback short positions after its
recent slide. []
Japan's Nikkei average opened down 0.3 percent on Friday as
investors locked in profits ahead of the weekend after a gain
of nearly 2 percent the previous day. []
Industrial metals climbed to their highest levels in
decades and gold set a record peak on Thursday, as the dollar
slid to its 2010 trough. []
(Editing by Clarence Fernandez)
