UPDATE 1-Oil steady after slide to 7-week low on U.S. demand

                                
 (Updates prices in paragraphs 3-4)
                                
 By Annika Breidthardt
                                
 SINGAPORE, July 24 (Reuters) - Oil steadied above $124 on
Thursday, after extending a steep drop from this month's record
high due to U.S. data that signalled economic woes and high
prices were slowing demand in the world's top consumer.
                                
 Prices have now fallen more than $23 a barrel from their
all-time peak above $147 on July 11, marking the biggest
decline in dollar terms in the market's history. In percentage
terms, the 15 percent tumble is the steepest pull-back since
early 2007.
                                
 U.S. light crude for September delivery <CLc1> gained 16
cents to $124.60 a barrel by 0655 GMT, after hitting a
seven-week low of $123.89. Prices had tumbled by more than $4 a
barrel on Wednesday, its sixth day of losses over the past
seven sessions.
                                
 London Brent crude <LCOc1> rose 20 cents to $125.49 a
barrel.
                                
 The decline came after data late on Wednesday showed a
larger-than-expected increase in U.S. gasoline stocks last
week, together with weak implied demand. U.S. crude stocks
dropped after a sharp decline in imports. [ID:nN23390086]
                                
 "We do not see any factors to push up prices at all at the
moment," said Tetsu Emori, a fund manager at Astmax Co Ltd in
Tokyo, adding he expected oil to move towards $117 or $118 a
barrel this week.
                                
 "In the long run, demand in emerging markets should
outweigh slower demand in the U.S. and other countries but for
(now) the market is focusing on the short term only," Emori
added.
                                
 Surging demand from emerging economies such as China and
India has fueled a sixfold rise in oil prices since 2002, but
concerns over flagging demand in top consumers, such as the
United States, Japan and South Korea, have dampened the rally
as of late.
                                
 Investment bank Lehman Brothers on Wednesday slashed its
forecast for 2008 world oil demand growth due to a
steeper-than-expected slowdown in energy consumption in the
United States and other OECD countries. [ID:nN23396953]
                                
 The market's rout appeared to spur some traders to unwind
short-dollar/long-oil positions built up earlier this year,
helping lift the U.S. currency to a one-month high against the
yen and in turn driving down other commodity prices. [nT10136]
                                
 Open interest in crude oil futures tumbled to its lowest
level since January 2, 2007, indicating that the sharp slide in
oil prices was more the result of investors liquidating long
positions rather than taking up fresh shorts. [ID:nN23569684]
                                
 Adding further downward pressure, Hurricane Dolly, which
had caused oil prices to firm up briefly early this week,
caused only minor output cuts at some refineries and offshore
oil and natural gas facilities in the Gulf of Mexico.
[ID:nN23431429]
                                
 Potentially adding some support to prices, the main
militant group in Nigeria's oil-producing Niger Delta said it
would attack major oil pipelines in the next 30 days to prove
it had not received payment from the government to end its
campaign. [ID:nL3926148]
                                
 "This will trigger the market if it happens, but not just
from the warning," Emori said.
 (Editing by Ramthan Hussain)