* U.S. cold spell supports crude
* Brent recovering from near 3-month low
* Brent-WTI spread continues to narrow
LONDON, Feb 6 (Reuters) - Brent crude rose above $107 a barrel on Thursday, recovering from a near three-month low hit at the start of the week as traders weighed Libyan supply disruptions against fears that turmoil in emerging markets could slow global growth.
Brent's premium over U.S. crude has fallen to its lowest since October this week. On Thursday the two benchmark contracts increased in tandem, with West Texas Intermediate (WTI) rising by $1, above $98 a barrel.
"The U.S. crude market - and as a matter of fact also the global market - looks in fact reasonably strong," analysts at JBC Energy in Vienna said in a note.
"It is therefore no surprise that oil prices have been able to weather the storm of emerging market currency devaluation, slides in equity prices, and flows of money back into government bonds relatively unscathed."
Brent for March delivery was trading 95 cents higher at $107.20 a barrel at 1212 GMT, having settled up 47 cents the session before. On Monday it fell to $105.40, the lowest since early November.
U.S. crude rose $1.04 to $98.42 a barrel, after closing up 19 cents on Wednesday. Its 50-day moving average, a key technical indicator watched by traders, was at $98.30. The benchmark was supported as severe snow and ice storms in the northeastern U.S. states boosted demand for heating fuels.
U.S. stocks of distillates, including heating oil, fell 2.4 million barrels last week - more than expected - and inventories of the fuels on the East Coast declined to their lowest level since April 2003, government data showed.
"While distillate stocks normally draw at this time of year, since the start of the year they have done so at a greater-than-normal rate and from a particularly low base level," Harry Tchilinguirian, head of commodity markets at BNP Paribas, said in a note.
Crude stocks at Cushing, delivery point of the WTI contract, fell 1.6 million barrels to 40.3 million barrels last week, reflecting the start-up of TransCanada Corp's 700,000-barrels-per-day Gulf Coast pipeline, which had been expected to ease a glut at the Oklahoma storage hub.
Brent was also supported by supply disruptions in Libya, where exports of around 600,000 barrels per day have been cut off by protests at ports in the east of the country.
Support for U.S. crude helped narrow the gap to the international benchmark <CL-LCO1=R> to $8.78 per barrel on Thursday. The spread touched $7.94 per barrel on Wednesday, the narrowest since Oct. 10, before closing at $8.87.
The narrowing gap comes as many investors have pulled out of heavy speculation in the spread.
"We have seen a clear step back from the speculative community, including hedge funds, simply because they lost so much money on trading the spread," said Mark Keenan, head of commodities research in Asia at Societe Generale.
"As a result, the spread is now more driven by fundamental factors, and this will keep volatility in the spread lower."
Investors will also keep an eye on the outcome of Thursday's European Central Bank policy meeting and whether policymakers would consider further stimulus to help a still-fragile euro zone economy.
(Additional reporting by Jacob Gronholt-Pedersen in Singapore; Editing by Dale Hudson)