LONDON, Sept 9: Oil prices shot up on Thursday as the latest estimates of US commercial crude inventories showed only a small jump in stocks of distillates ahead of the US winter, analysts said.

The price of benchmark Brent North Sea crude oil for delivery in October jumped $1.19 per barrel to $41.58 in late trading in London. New York's reference contract, light sweet crude for October delivery, advanced $1.23 to $44 per barrel in early deals.

"The market is concerned that distillate stocks barely climbed (in the week ending September 3) during a time when US refineries are working flat-out," Societe Generale analyst Frederic Lasserre said.

The US Energy Department said distillate inventories, which include heating oils, were up 200,000 barrels at 126.6 million in the week to September 3. Analysts had forecast a rise of 1.25 million barrels.

According to a separate survey by the private American Petroleum Institute, distillate reserves rose 1.62 million barrels to 126.25 million. The government and industry surveys also showed a mixed picture of US inventories of crude oil, but both reports showed a sharp drop in gasoline supplies.

Oil prices had dipped earlier in the day on expectations of rising output from the Opec and as the International Energy Agency said markets were "well-supplied with crude".

The Paris-based IEA said: "What is clear for now is that supply is running ahead of demand and stocks are building. "The report was "slightly more bearish than it has been in the past", said Commerzbank analyst David Thomas.

Oil inventories were returning to the normal range, while Opec was expected to increase production through the rest of the year and Russian output was also rising, he added. "It shows there is an easing of the tightness of the supply," said Thomas. -AFP