* U.S. gasoline futures hit highest since early May
* Crude oil stocks seen down last week
* Coming Up: API oil inventory data; 2130 GMT
(Adds details, updates prices)
By Randy Fabi
SINGAPORE, Dec 21 (Reuters) - Oil prices rose for the
third straight session on Tuesday, supported by cold weather
in the United States and Europe, seasonal gasoline demand, and
an expected drop in U.S. crude stocks.
U.S. crude for February <CLc1> climbed 20 cents to $89.57
a barrel by 0750 GMT. ICE Brent crude <LCOc1> traded 10 cents
higher at $92.84.
Trading volume was expected to remain thin this week with
strong resistance seen at $90 a barrel and support at $88,
said Tetsu Emori, a fund manager at Tokyo-based Astmax Co Ltd.
"Oil prices are being driven by the oil product markets,
which have risen on driving demand for the Christmas season
and the cold in the north," Emori said.
U.S. gasoline futures <RBc1> rose to $2.3869 a gallon at
0750 GMT, highest since early May, on hopes that holiday
driving will boost demand.
Heating oil and gas oil futures also gained as frigid
weather in the United States and Europe fueled demand.
Heating oil demand in the world's largest oil user was
expected to be 4.6 percent above normal this week, according
to the U.S. National Weather Service. []
Weekly oil inventory reports were expected to show crude
oil and distillate stocks fell last week, though gasoline
stockpiles were estimated to have risen, according to a
Reuters survey of analysts on Monday.
U.S. oil inventory data from the American Petroleum
Institute is due later on Tuesday, with the government's
report following on Wednesday.
Snow and frigid temperatures grounded flights and
disrupted road and rail links across northern Europe,
stranding travellers and closing schools.
The dollar fell against a basket of currencies, while the
euro remained under pressure after ratings agency Moody's said
it may cut the ratings on some Spanish banks.
The euro bounced back from a two-and-a-half week low on
short-covering on Tuesday afternoon, though simmering fears
that some euro zone countries and banks could face more
borrowing strain are likely to limit gains. [].
Markets were also closely monitoring tensions in the
Korean Peninsula.
North Korea stepped back from confrontation over
"reckless" military drills by the South and reportedly issued
a new offer on nuclear inspections, drawing a cautious
response from Seoul and Washington. []
In China, its kerosene imports for November hit an all
time high of 861,388 tonnes, up nearly 61 percent a year ago,
official customs data showed on Tuesday. [].
Strong Chinese demand for distillates could also support
the firm crude sentiment, as its major refineries are likely
to keep their crude throughput high.
Final November trade data from the world's No. 2 oil user,
China, showed crude imports rose 22 percent in November from
October. []
For a graphic, see:
http://graphics.thomsonreuters.com/F/12/CN_TRD1210.html
(Additional reporting by Seng Li Peng; Editing by Ed Lane)
