* Oil up on larger-than-expected drawdown on stocks
* Conflict between Georgia and Russia lends some support
* Tight credit issues may limit sharp price rises
By Seng Li Peng
SINGAPORE, Aug 14 (Reuters) - Oil rose nearly $1 and moved
closer to $117 a barrel on Thursday, extending gains of $3 in
the previous session, as a larger-than-expected drawdown in
crude and gasoline stocks in the United States rekindled supply
concerns.
However, a tight credit market in the U.S. could limit a
sharp rise in prices, analysts said.
U.S. crude <CLc1> was up by 91 cents to $116.91 a barrel at
0219 GMT, after the country's crude stocks dropped 400,000
barrels, while gasoline inventories fell by 6.4 million barrels
in the week to Aug. 8 as refinery throughput decreased, the
Energy Information Administration (EIA) said.
The fall in gasoline stocks was beyond analysts'
expectations of a 2.1-million-barrel decline [].
Distillates stocks also unexpectedly decreased, and the
drawdown came after companies shut U.S. Gulf Coast facilities
due to Tropical Storm Edouard.
The conflict between Russia and the U.S. over Georgia also
supported prices.
Georgia had accused Russia of breaking a cease-fire in
their six-day-old conflict on Wednesday, and U.S. President
George W. Bush demanded Moscow resolve a crisis that has
strained relations with the United States. []
Russia, on the other hand, accused the U.S. of playing a
dangerous game in the Caucasus by backing Georgia and denied
Moscow was not doing enough to prevent looting. []
However, oil is still far away from this year's peak at more
than $147 a barrel it hit in mid-July, and analysts said it's
unlikely the market could move anywhere close to that level
soon.
"There are not that many factors that can drive prices
higher," said Gerard Burg, a commodities analyst at National
Australia Bank in Melbourne.
"The conflict in Georgia does not have that much impact.
The pipeline was already offline," he added.
BP has already closed an oil pipeline and a natural gas
pipeline running from its Caspian Sea fields through Georgia
but said neither had been damaged.
A third BP pipeline that runs through Georgia, the
Baku-Tblisi-Ceyhan oil pipeline, was shut last week following
an explosion in Turkey.
Overall, consumer spending in the U.S. is still weak amid
tight credits issues, and high energy prices have forced
consumers to drive less.
The U.S. Transportation Department said on Wednesday that
Americans drove 12.2 billion miles, or 4.7 percent, less in
June compared with a year earlier. It was the eighth month in a
row driving declined [].
Eyes are now on OPEC, to see if it would cut back on oil
supplies.
Iran's OPEC governor Muhammad Ali Khatibi said on Tuesday
that the organisation should trim its oil output if demand
continues to fall in slowing industrialised economies.
[]
Khatibi said Iran is pumping around 4 million barrels per
day of total capacity of around 4.3 million bpd. Iran's
informal OPEC target is 3.817 million bpd, although Khatibi
said Tehran had never agreed with OPEC's calculation of that
target.
Iran believed it was entitled to produce around 100,000 bpd
more than that target, Khatibi said.
The U.S. dollar rose on Wednesday for a ninth consecutive
session against a basket of currencies, by 0.2 percent to
76.278 <.DXY>. []
(Editing by Sambit Mohanty)
