By Scott DiSavino
NEW YORK (Reuters) - Oil futures held mostly steady on Wednesday as the market waits for direction from a U.S. crude inventory report that is expected to show a big draw.
Analysts estimate U.S. commercial crude inventories probably fell by 2.5 million barrels, down for the fifth straight week, according to a Reuters poll. [EIA/S]
The U.S. Energy Information Administration will release its weekly petroleum status report at 10:30 a.m. EST (1530 GMT). [EIA/S]
Brent (LCOc1) futures for February delivery were up 1 cent at $55.36 a barrel at 9:51 a.m. EST (1451 GMT). U.S. West Texas Intermediate crude
The American Petroleum Institute industry group late on Tuesday reported a much larger-than-expected 4.1-million-barrel crude draw that analysts said carried U.S. WTI to a one-week high earlier in the session. [API/S]
Even though the February WTI futures were little changed, the U.S. front-month (CLc1) was up more than 2 percent and trading at its highest level in more than a week due to the contract roll from lower-priced January to higher-priced February on Tuesday.
That puts the front-month on track for its fourth day of gains in a row, rising about 5 percent since Friday.
"This week's trade has thus far provided no surprises as reduced holiday volume has been contributing to some narrow trading ranges," Jim Ritterbusch, president of Chicago-based energy advisory firm Ritterbusch & Associates, said in a report.
"While today's EIA report could pop price volatility a notch, we don't expect major price impact," Ritterbusch said.
Hourly volume in the front-month contract was around 2,300 lots on Wednesday, compared with a historical average of 2,400 for the second half of December, according to trading data from the InterContinental Exchange.
French bank Societe Generale (PA:SOGN) said the agreement between the Organization of the Petroleum Exporting Countries and other leading producers to cut output in January should keep crude prices in the $50-to-$60 range in 2017.
Oil markets are expected to remain well-supplied despite the planned reductions.
Russia's 2016 oil output is expected to total 547.5 million tonnes (11 million barrels per day), a 2.5 percent increase from last year, Energy Minister Alexander Novak told reporters late on Tuesday.
Taking advantage of plentiful and relatively cheap crude, refiners especially in Asia are churning out more fuel than the market can absorb.