* Yemen opposition calls for protest, Gaddafi holds ground
* Rocket from Gaza strikes deep in Israel
* Global markets watch Portugal austerity vote
* U.S. gasoline stocks fall sharply
(Updates prices)
By Ikuko Kurahone
LONDON, March 23 (Reuters) - Oil rose on Wednesday as
gasoline inventories in the United States fell more than
expected and due to ongoing violence and unrest in the Middle
East and North Africa, a vital part of global energy supply.
U.S. crude futures <CLc1> extended gains following the
release of the U.S government weekly oil data at 1430 GMT,
pulling up North Sea Brent crude.
U.S. crude rose 67 cents to $105.65 a barrel by 1550 GMT.
Brent crude futures <LCOc1> were trading 8 cents up at $115.77
by the same time, trimming the earlier loss down to $115.08.
U.S. government data showed a 5.32 million barrel drop in
gasoline inventories in the week to March 18, surpassing an
analyst forecast of a 1.8 million barrel drop. []
For so far in March, the fall in gasoline has already been
the biggest since 1990, when the U.S. Energy Information
Administration started the weekly report.
Gasoline demand over the past four weeks was 1.2 percent
higher than a year earlier.
But some analysts have cautioned that the fall came against
the backdrop of a build up in inventories to multi-year highs
earlier this year and crude and distillates stocks rose.
"Despite the price point, gasoline demand is relatively
strong at just over nine million barrels (per day)," John
Kilduff, partner with Gain Capital in New York, said.
"The drawdowns, by contrast, have been substantial, which is
due entirely to the persistently low refinery utilisation rate."
Earlier in the day, prices seesawed due to civil unrest
across North Africa and the Middle East and resulted in the
shutting in of the bulk of Libya's oil output.
Brent prices dipped as western warplanes silenced Muammar
Gaddafi's artillery and tanks besieging rebel-held Misrata in
western Libya on Wednesday.
Breathing defiance, Gaddafi earlier said Western powers who
carried out a fourth night of air strikes on Libya to protect
civilians under a U.N. mandate were "a bunch of fascists who
will end up in the dustbin of history." []
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More on Middle East unrest: [] []
Libya graphics http://link.reuters.com/neg68r
Oil technicals []
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In Yemen, a small oil and gas producer, opposition groups
called on protesters to march on President Ali Abdullah Saleh's
Sanaa palace on Friday to demand he step down, hoping to end a
crisis his allies abroad fear will benefit Islamic militants.
"Yemen is a very hot topic now. It is not that important to
the oil market but unrest in the region gives enough
psychological support to prices," Andy Sommer, energy market
analyst with EGL, said.
Its neighbour Saudi Arabia is the world's top oil exporter
and the only OPEC member nation with enough spare capacity to
compensate for supply disruptions elsewhere.
Protests in Syria continued and conflicts in the Gaza strip
were escalating. []
Palestinian rockets struck two cities deep in Israel on
Wednesday, wounding a resident and prompting a deputy to Prime
Minister Benjamin Netanyahu to call for a new offensive against
the Hamas-ruled Gaza Strip. []
In West African oil producer Nigeria, some violence has been
reported ahead of presidential election in April.[]
Global markets were also watching a key vote on austerity
measures in Portugal that could see the country's government
brought down. The euro slipped ahead of the vote. []
[]
Also of concern is the impact of Japan's earthquake and
tsunami. The cost of the damage could top $300 billion, making
them out the world's costliest natural disaster. []
(Additional reporting by Alejandro Barbajosa; editing by Alison
Birrane)
