LONDON (AFP) - World oil prices crept higher on Wednesday ahead of the latest weekly report on US energy stockpiles, and amid lingering concerns about the strength of global demand, traders said. London's Brent North Sea crude for September delivery added 37 cents to 111.52 dollars per barrel in electronic trading. New York's main contract, light sweet crude for September delivery won back 43 cents to 113.44. Later on Wednesday, the US government will release its weekly update on American crude oil inventories for the week ending August 8. Market expectations are that American crude stockpiles fell by 600,000 barrels last week. Analysts have pencilled in a drop of 2.0 million barrels for US gasoline or petrol reserves. Crude futures had slid to a four-month low on Tuesday after Russia announced the end of military operations in Georgia and the International Energy Agency forecast a steep drop in demand in advanced countries. "We still expect oil prices to decline over the course of 2009," said David Moore, commodity strategist at Commonwealth Bank of Australia, cited by Dow Jones Newswires. "The high level of oil prices should induce demand-side adjustments. "However, it would be wrong to think that all of the fundamental issues that contributed to the high level of oil prices over the past year have disappeared." Dealers said fears of supply disruption had receded somewhat after Russia and Georgia agreed to a French-brokered peace plan, following Moscow's decision to halt its military offensive. British energy giant BP said on Tuesday that it had closed an oil pipeline because of the fighting, but that supplies were flowing from the Caspian Sea to the West by other routes. Also on Tuesday, the Paris-based International Energy Agency said that demand had eased in the 30 advanced economies in the Organisation for Economic Cooperation and Development, which groups industralised nations. "Demand destruction is a pretty significant fact in the US and OECD," said Jason Feer, vice president with energy analysts Argus Media. "So I think it looks as though you are starting to see the impact of higher prices" on demand. Oil prices have sunk since hitting record highs above 147 dollars one month ago as the market frets about weakening demand due to the slowing global economy. However, crude futures are more than ten percent higher than at the start of the year when they surged past 100 dollars for the first time in history.