Oil hovered around $63 a barrel on Friday, near its lowest levels since March, as ample U.S. fuel stocks looked set to meet winter heating demand in the world's biggest consumer.
U.S. crude was unchanged at $63.22 a barrel at 0948 GMT after falling 64 cents on Thursday.
London Brent crude was down 4 cents to $63.50.
U.S. natural gas futures sank to a two-year low on Thursday after a surprise rise in stocks. Natural gas stocks are over 12 percent above the average for the last five years.
Distillate stocks, which include heating oil, also jumped more than expected and were well above the five-year average, according to the U.S. government.
The large natural gas and distillate stocks are the main bearish factors that have brought prices down again, said Tetsu Emori, chief strategist at Mitsui Bussan Futures.
Concerns over potential supply disruptions from the world's fourth largest oil producer Iran have waned as major powers disagree on the next step to take in the dispute over Tehran's nuclear program.
United Nations weapons inspectors have protested to the U.S. government and a congressional committee about a report on Iran's nuclear work, calling parts of it outrageous and dishonest, according to a letter obtained by Reuters.
The letter said a committee report contained errors suggesting that Iran's nuclear fuel program was much more advanced than a series of U.N. nuclear watchdog reports and Washington's own intelligence assessments had determined.
NIGERIA STRIKE OFF
Supply concerns also eased as Nigerian oil workers suspended a three-day strike early and the U.S. government studied a request by oil major BP to restart shut-in output at its giant Alaskan Prudhoe Bay oilfield.
The improved supply picture has led investors to take profits, pushing the market down about 20 percent from a record-high of $78.40 in July.
Aborted raids on oil and gas facilities in Yemen on Friday were a reminder of supply threats in the Middle East.
Four car bombers and one security guard were killed, but the attack caused no damage to the state-owned facilities.
The attacks came days after the fifth anniversary of the September 11, 2001 attacks on the United States, when al Qaeda's deputy chief Ayman al-Zawahri called on Muslims in an Internet video on Monday to stop what he called the theft of Muslim oil by Western nations.
The Atlantic hurricane season has been mild from the perspective of its impact on oil infrastructure. Two storms were raging on Friday but forecasters said neither posed any immediate threat to land.
(Additional reporting by Yaw Yang Chon in Singapore)