* Intraday dollar weakness, equities rise lifts oil
* EIA, OPEC see slower global oil demand growth in 2012
* US crude inventories seen lower, products up - survey
* Coming up: EIA oil inventory data, 1430 GMT Wednesday (Recasts, updates with API data, adds detail throughout)
By Robert Gibbons
NEW YORK, July 12 (Reuters) - Oil rose on Tuesday, shaking off two days of losses to turn positive on the dollar's intraday weakness and supportive technicals.
U.S. crude futures posted stronger gains than Brent,
narrowing the spread between the contracts
The day's choppy trading continued into post-settlement when Moody's Investor's Services cut of Ireland's credit rating to junk status pressured the euro and caused U.S. equities to end lower a third straight session. [ID:nN1E76B1I8] [.N]
Prior to the Ireland downgrade, the dollar index <.DXY> had weakened and the euro trimmed losses as risk aversion tied to the European debt crises eased slightly. A weaker dollar is usually supportive to dollar-denominated oil prices.
Brent turned lower and U.S. crude pared gains in post-settlement trading after industry data showed a surprise build in U.S. crude oil inventories last week. [API/S]
Brent crude futures for August
U.S. crude
"Today's oil trade hitched a ride on the strong rebound in the euro and U.S. stock market," Jim Ritterbusch, president at Ritterbusch & Associates in Galena, Illinois, said in a note.
"An additional feature was provided by the unwinding of the Brent-WTI spread positions ahead of Thursday's August Brent expiration," he added.
U.S. crude trading volumes outpaced Brent and both finished below their 30-day averages.
"(U.S. crude) had a bounce off the 200-day moving average and the S&P 500 (index) has held above the 1,300 level, helping (U.S.) crude bounce," said Robert Yawger, senior vice president, energy futures at MF Global in New York.
Oil and U.S. stocks also got a brief lift after the Federal Open Market Committee's minutes from its June meeting said some Federal Reserve officials were ready to provide more monetary easing if the recovery was too sluggish to cut unemployment. [ID:nN1E76B18T]
European Union leaders will hold an emergency summit on Friday after finance ministers acknowledged for the first time that some form of Greek default may be needed to cut Athens' debts and stop the crisis from spreading. [ID:nL6E7IC097]
EIA, OPEC MONTHLY REPORTS
Also supportive for oil, the U.S. Energy Information Administration said in a monthly report that it expects global oil markets to tighten through next year, despite the International Energy Agency's release of crude from strategic reserves. [ID:nWNA3412]
But even with the EIA's expectations about tighter supply-demand balance, both OPEC and the EIA cut demand growth forecasts for 2011 and 2012. [ID:nN1E76B16C] [ID:nL6E7IC11Z]
A separate report from MasterCard showed U.S. gasoline demand for the July 4 holiday dropped to the lowest level since 2007 as Americans cut back on driving due to high pump prices. [ID:nN1E76B1IK]
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
(Graphic on 4-week avg U.S. gasoline demand:
http://link.reuters.com/dah62k)
FACTBOX on IEA's oil release [ID:nL6E7I80VV]
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Ahead of those reports, Brent's bounce was curbed by news
that Royal Dutch Shell
Output from nine key North Sea grades is set to fall by around 8 percent in August from July as maintenance work and declining output curbs production. [ID:nL6E7IB0FJ]
U.S. OIL INVENTORIES
The API weekly oil inventory report showed crude stocks rose 2.3 million barrels in the week to July 8.
Gasoline stocks fell 1.6 million barrels and distillate stockpiles rose a whopping 4.8 million barrels.
Ahead of the API report, crude oil inventories were expected to have fallen, by 1.8 million barrels, according to a Reuters survey of analysts. [EIA/S]
Distillate stocks were expected to be up 400,000 barrels and gasoline stockpiles up slightly, only 200,000 barrels.
The government's report from the EIA will follow on Wednesday at 10:30 a.m. EDT (1430 GMT). (Additional reporting by Gene Ramos and Matthew Robinson in New York, Simon Falush in London and Alejandro Barbajosa in Singapore, editing by Dale Hudson and David Gregorio)