SINGAPORE (Reuters) -- U.S. oil prices held above $30 a barrel Friday, hovering near two-week highs as traders fretted over winter heating oil supplies in the world's biggest energy consumer.

Carefully watched U.S. fuel stocks had been rising ahead of the northern hemisphere winter in recent weeks, helping offset worries about the impact of OPEC's output cut, and pushing oil prices down 12 percent.

But prices surged more than 5 percent Wednesday after weekly data showed lower-than-expected inventories.

"Wednesday's powerful rally still seems to have staying power," brokers Man Financial said in a daily report.

By midday in London, Brent crude for January delivery was 33 cents higher at $28.74 a barrel, reversing small Thursday losses. U.S. December light crude gained 26 cents at $30.52 a barrel.

Heating fuel demand could rise as the mild weather in the U.S. Northeast, the biggest consumer of heating oil, is expected to turn colder this weekend, according to private weather forecaster Meteorlogix.

According to the U.S. Energy Information Administration's (EIA) report Wednesday, heating oil stockpiles fell last week to stand just 1.4 percent above last year's lowly levels.

U.S. heating oil prices were up 52 points at 82.74 cents a gallon Friday, about 10 percent higher than this time last year.

The threat of another output cut by OPEC this year has also supported prices, pushing the cartel's own price basket to just cents away from the top of its preferred $22-$28 range.

The president of the Organization of the Petroleum Exporting Countries, Abdullah al-Attiyah, warned earlier this week that if oil supplies continue to grow as they had been in recent weeks, it might have to cut supplies again.

OPEC implemented a 3.5 percent cut in output Nov. 1, reducing its production ceiling to 24.5 million barrels per day (bpd) on concern of a contra-seasonal increase in winter oil stockpiles as Iraq and non-aligned exporters, like Russia, lift exports.