GO
Loading...

UPDATE 5-Brent rises close to $110 on U.S. oil stocks data

* Brent, U.S. oil hold steady near two-week highs

* Ukrainian soldiers killed, wounded in ambush in east

* U.S. crude stocks fall in Cushing but rise overall

* Libya's western El Feel oilfield resumes output -NOC

* Protesters still stop restart of Libya's Sharara oilfield

(Adds detail on U.S. oil stocks, quotes)

LONDON, May 14 (Reuters) - Brent futures rose to nearly $110 a barrel on Wednesday, reaching a two-week high, on a draw in some crude oil stocks in the United States and the deteriorating situation in the Ukraine.

Brent crude for June delivery was up 77 cents at $110.01 a barrel at 1457 GMT after closing up 83 cents. The June contract expires on Thursday.

U.S. oil was up 83 cents at $102.53 a barrel after finishing $1.11 higher in the previous session at its highest settlement since April 24.

U.S. crude stocks rose overall last week but fell by 592,000 barrels at the storage hub in Cushing, Oklahoma, the delivery point of the U.S. oil futures contract, data from the Energy Information Administration showed on Wednesday. Gasoline and distillate inventories fell as refineries cut output.

"The fact that we're seeing continued drawdowns in Cushing has kept the market closer to $100 a barrel. Ukraine and Russia add a premium in this market, and there are signs that China has awoken to the fact that they need to stimulate the economy," Bill Baruch, senior market strategist at iitrader.com in Chicago, said.

On the bearish side, U.S. Gulf coast crude oil stocks rose to a new record high, the EIA said.

Global supplies could also be set for an increase with the resumption of a major Libyan oilfield, but the market has become accustomed to false hopes from there and unexpected openings and shutdowns.

"The return of some Libyan output is relatively important but people are more concerned with Ukraine," Eugen Weinberg, analyst at Commerzbank in Frankfurt said.

The El Feel oilfield, also known as Elephant, resumed production, Libya's state oil company said on Wednesday, after protesters agreed to end their blockade of the pipelines connecting that field to the port of Mellitah.

But the larger 340,000-barrel-per-day El Sharara oilfield was still closed as its pipeline to the Zawiya port remained blocked.

Also acting as a dampener for demand, a slew of data from China on Tuesday, including industrial output, retail sales and fixed asset investment, showed slower growth for April in the world's second largest economy.

China consumed roughly 9.71 million barrels per day (bpd) of oil last month, according to Reuters calculations based on preliminary government data, the lowest level in seven months and down from 9.79 million bpd in March. Growth in China's oil demand has been slowing since mid-2013, the International Energy Agency said in an April report.

(Additional reporting by Keith Wallis, editing by William Hardy)