World oil prices drifted higher on Thursday but the market remained plagued by persistent doubts over the eurozone's debt crisis and in particular the plight of Italy, traders said.
New York's main contract, light sweet crude for December, gained $US2.04 to $US97.78, lifted by indications of strengthening demand in top oil consumer the United States.
Brent North Sea crude for delivery in December added 16 US cents to $112.47 a barrel in London afternoon trade.
"Crude prices have gathered some modest upside momentum to recover some of yesterday's losses as equities pare losses and Italian debt yields come off their record highs," said Myrto Sokou, an analyst at Sucden brokers.
"The darkening state of affairs in the single currency region and lack of clarity of proposed remedies ... is likely to exert significant downside pressure on crude prices until the prospect of genuine improvement emerges."
Traders on Thursday reacted to news that the International Energy Agency had cut its oil demand forecast.
The IEA revised down expected global oil demand slightly by 70,000 barrels per day this year and by 20,000 barrels next year after unexpectedly low third-quarter demand data from the United States, China and Japan.
It also warned that the debt crisis, tensions over Iran, flagging growth and the approaching northern hemisphere winter were proving difficult for the oil market to read clearly.
