Oil prices rose Wednesday as a U.S. government report showed heating fuel stocks in the world's largest energy consumer remained tight ahead of the winter, despite a small build in distillate supplies.

U.S. light crude (search) settled up 50 cents to $49.44 a barrel, up 50 percent from the start of the year but more than $6 off their all-time peak one month ago. London Brent was up 37 cents at $44.82 a barrel.

The U.S. government reported on Wednesday that distillate stocks, which include heating oil and diesel fuel, rose 1 million barrels last week to 115.6 million barrels, the first build since mid-September.

But supplies of the key winter fuels remained 14 percent below last year, with heating oil stocks alone keeping a 16 percent year-on-year deficit, the Energy Information Administration (search) (EIA) said.

"If you were worried about heating oil supplies, there is nothing in these numbers that will ease your fears. Heating oil stocks are continuing to be an issue," said Phil Flynn, analyst at Alaron Trading in Chicago.

Adding to support, the EIA said U.S. natural gas stocks fell last week by 49 billion cubic feet (bcf), more than the 10 million bcf draw analysts had forecast.

"The natural gas number was surprisingly supportive; everybody was looking for a modest withdrawal," said Marshall Steeves, analyst at Refco Group in New York.

So far, major consuming nations have experienced mild winter weather, though U.S. government and private forecasters are expecting temperatures in the winter months to average slightly colder than normal.

A cold spell could drive up domestic heating oil usage in the heavy-consuming Northeast, adding to U.S. distillate demand that is already running about 8 percent above last year due to strong trucking and manufacturing activity.

"Without a mild winter to keep demand from increasing significantly, the heating oil market in the United States should remain relatively tight, keeping pressure on prices," the EIA said in its weekly review.

Worries over winter stockpiles have overshadowed a steady increase in crude oil supply in major consumer nations, thanks to the highest OPEC production in 25 years. OPEC has been struggling to keep up with strong demand growth from China and the United States.

A Gulf source said on Wednesday that Saudi Arabia will keep pumping oil at about 9.5 million barrels per day (bpd) through the end of the year and that the kingdom sees no sign of a let-up in strong oil demand.

OPEC itself has predicted a rare winter stock build if it were to maintain current oil production rates of around 30 million bpd. The group meets on Dec. 10 in Cairo to review output policy and is expected by traders to keep official output limits unchanged.

Traders remain on edge over supply hiccups, especially in Iraq, where exports from the main southern terminal were running at only 1 million bpd following a pipeline blast on Monday.

Oil sources said it may take a week to mend the corroded pipeline, which has cut flows by 800,000 bpd.

Vietnam was forced to shut about 400,000 bpd of offshore oil production for three days due to a typhoon, while output at Canada's second-largest offshore field, the 165,000-bpd Terra Nova, was still suspended after a spill on Sunday.