SINGAPORE - OIL prices hovered just above US$60 (S$87.50) a barrel on Friday in Asia as investors braced for a slew of company earnings reports next week that will provide clues on the strength of crude demand.

Benchmark crude for August delivery was down 9 cents at US$60.32 a barrel by midday Singapore time in electronic trading on the New York Mercantile Exchange. On Thursday, the contract rose 27 cents to settle at US$60.41.

Oil has bobbed near US$60 a barrel the last two days after dropping from an eight-month intraday high of US$73.38 on June 30 on investor concern that a rally since March wasn't justified by weak global crude demand.

'All the focus in on demand,' said Christoffer Moltke-Leth, head of sales trading for Saxo Capital Markets in Singapore. 'The second quarter earnings season is going to be very important for crude.'

'If we see disappointments there, people will say we've gone too far, too fast.' Aluminum maker Alcoa Inc, the first Dow Jones industrial average component to release earnings, reported a narrower-than-expected loss.

Results over the next few weeks from multinational mass market retailers - such as Colgate Palmolive, PepsiCo, and Johnson & Johnson - will help investors better gauge the strength of the global economy.

'These companies have a good feel for how demand is around the world,' Mr Moltke-Leth said. 'What they say is going to be important for the near-term outlook for oil.'

In other Nymex trading, gasoline for August delivery fell 1.13 cents to US$1.65 a gallon and heating oil was steady at US$1.53. Natural gas for August delivery jumped 2.2 cents to US$3.43 per 1,000 cubic feet.

In London, Brent prices fell 9 cents to US$61.01 a barrel on the ICE Futures exchange. -- AP