Oil rises on U.S. inventory draw, Brexit deal hopes

* U.S. crude, gasoline and distillate stocks fall last
week-EIA
* Investors cheer a potential Brexit trade deal
* U.S. drillers add oil and gas rigs for fifth week in row

By Yuka Obayashi
TOKYO, Dec 24 (Reuters) - Oil extended gains on Thursday as
a drawdown in U.S. stockpiles of crude and gasoline lifted
demand hopes, while investors also cheered a potential Brexit
trade deal.
U.S. West Texas Intermediate (WTI) crude CLc1 futures rose
18 cents, or 0.4%, to $48.30 a barrel by 0124 GMT, while Brent
crude LCOc1 futures climbed 20 cents, or 0.4%, to $51.40.
Both contracts gained more than 2% on Wednesday.
"Oil markets are quiet as all investors are in a holiday
mode," said Hiroyuki Kikukawa, general manager of research at
Nissan Securities.
"Lower U.S. inventories of crude and fuels as well as signs
of a potential Brexit deal which led to weaker U.S. dollar were
good news, but lingering worries over a new variant of the novel
coronavirus capped gains," he said.
U.S. crude inventories USOILC=ECI fell by 562,000 barrels
in the week to Dec. 18 to 499.5 million barrels, the Energy
Information Administration said on Wednesday. Gasoline stocks USOILG=ECI fell by a surprise 1.1 million
barrels to 237.8 million barrels, the EIA said, while distillate
stockpiles USOILD=ECI fell by a more-than-expected 2.3 million
barrels to 148.9 million barrels.
Oil prices also drew support from news than Britain and the
European Union were on the cusp of striking a narrow trade deal
on Thursday, swerving away from a chaotic finale to the Brexit
split. The potential deal boosted sterling GBP=D3 , which was up
0.13% against the dollar after closing up 0.9%. A softer dollar
makes commodities priced in the greenback more affordable for
holders of other currencies. FRX/
Still, investors remain jittery about the recovery of oil
demand as a more contagious variant of the coronavirus that is
quickly spreading across Britain prompts countries to shut their
borders to the UK. Americans were also warned again not to travel for Christmas
as the latest surge in cases overwhelmed hospitals. Raising concerns over a supply glut, U.S. energy firms this
week added oil and natural gas rigs for a fifth week in a row.
The oil and gas rig count, an early indicator of future
output, rose 2 to 348 in the week to Dec. 23, energy services
firm Baker Hughes Co BKR.N said.