Oil edged back up above $97 a barrel in thin trade on Friday, buoyed by the unrelenting decline in the U.S. dollar, while some OPEC members showed signs of stepping up output ahead of their policy meeting in two weeks.
U.S. light crude for January delivery gained 7 cents
to $97.36 a barrel in Globex trade, while London Brent crude rose 40 cents to $94.90 by 0725 GMT.
U.S. crude is now 7 cents above its Wednesday close, the last day of open-outcry trading before Thanksgiving.
Oil hit a lifetime high of $99.29 a barrel on Wednesday, but has since fallen on a rise in mid-continent U.S. oil stocks, more pessimism about the outlook for the U.S. economy and, on Thursday, signs of higher OPEC shipments in early December.
OPEC oil exports, excluding Angola, will rise by 720,000 barrels per day (bpd) in the four weeks to December 8, according to Roy Mason of consultancy Oil Movements.
The increase will be the biggest this year, with most of the extra supply heading to Western refiners. Mason estimated that seaborne exports from the 11 OPEC countries would rise to 24.54 million bpd from 23.82 million bpd to November 10.
OPEC ministers are due to meet in Abu Dhabi on December 5, although many members have said more crude would be unlikely to tame a rally fueled by speculation and political tension.
The OPEC question is an open one. We may see OPEC increasing production but there is no certainty. The oil market remained fundamentally tight, said David Moore, a commodity strategist at the Commonwealth Bank of Australia in Sydney.
A further decline in the dollar to the latest in a succession of record lows against the euro also bolstered oil prices, which have been trading inversely to the U.S. currency.
Oil's rally fell short of the $100 mark on Wednesday after a 1.2 million-barrel rise in crude stocks at the delivery point for U.S. crude futures in Cushing, Oklahoma, overshadowed the overall drawdown in nationwide inventories.
The data showed a surprising fall in distillate stocks by 2.4 million barrels, including heating oil and diesel fuel, ahead of a chilly winter in the U.S. northeast.
(Reporting by Felicia Loo; Editing by Ramthan Hussain)