Oil steadied today as traders weighed comfortable US crude stocks against disruptions to Australian supplies and concerns over Opec producer Iran's nuclear dispute with the West.
US crude was down 5 cents at $61.59 a barrel at 0645 GMT, after an 18-cent loss yesterday. London Brent crude was 3 cents lower at $62.30.
Prices were little changed over the week, after rallying from below $50 in mid-January. Gains of more than a dollar on Wednesday, when government data showed a surprise 4.8 million-barrel fall in US crude stocks, offset early-week losses.
US crude inventories are still comfortable at the upper end of the average range for this time of year, with last week's stock levels skewed by fog along the US Gulf Coast.
Supplies from Australia have been disrupted by Cyclone George, forcing the shutdown of at least 180,600 barrels per day (bpd) of offshore oil production, or almost half the country's output, with a second storm also threatening operations.
"While crude's flat price could remain rangebound in the high $50s to low $60s in the very short-term, our view is that near-term price risk is to the upside. We see good fundamental support for crude in March-April," said JP Morgan.
The market is also supported by concerns over gasoline inventories prior to peak summer driving demand in the northern hemisphere, after a 3.8 million-barrel fall in US gasoline stocks last week amid a series of refinery glitches.
A continuing rebound in global equity markets has helped ease market fears of a US economic slowdown.
Traders are now looking ahead to Opec's meeting next week. Venezuela's energy minister said the priority at the meeting should be to verify compliance among members on previously agreed production cuts.
The group at its previous two meetings in October and December has lowered pledged output by a total of 1.7 million bpd, roughly 6 per cent of production, from February 1st. Outside estimates indicate members have cut supply by about one million bpd.
Dealers are also watching the progress of OPEC-member Iran's row over its nuclear programme with the West.
UN nuclear agency governors yesterday approved cuts in technical aid to Iran, to uphold UN sanctions implemented over concern that Tehran may be trying to build atomic bombs.