* Oil remains volatile, subject to exchange rate jitters
* Technicals show oil to retrace to below $81
[]
* Coming Up: U.S. Fed Chairman Bernanke speech; 1215 GMT
(Updates prices)
By Alejandro Barbajosa
SINGAPORE, Oct 15 (Reuters) - Oil rose on Friday, heading
for a third straight weekly close above $80, as hopes for
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 32 cents to $83.01 a
barrel by 0642 GMT, less than $1.50 from last week's five-month
peak of $84.43, while December ICE Brent <LCOc1> gained 19
cents to $84.39. November Brent expired on Thursday.
Thursday's drop in the dollar to 2010 lows 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 ago, 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 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.
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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.
[]
For OPEC, "what might in advance have looked like a
potentially difficult year has instead turned out to be a very
constructive one in terms of revenue dynamics," Barclays
Capital analysts headed by Paul Horsnell wrote in a weekly
report.
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.
Fed Chairman Ben Bernanke's speech in Boston could provide
clues on what monetary authorities are planning to do next.
Investors took profits on gains in stocks and commodities
this week while buying back the U.S. dollar on Friday, but kept
the currency close to a 10-month low. []
Nationwide strikes paralysed oil refining in France on
Thursday, with all 12 plants disrupted and the government
trying to reassure the public about fuel supply as panic buying
led to brief shortages at petrol stations. []
(Editing by Clarence Fernandez)
