By Osamu Tsukimori TOKYO, Oct 28 (Reuters) - Oil edged down towards $79 a barrel on Wednesday, giving up some of the previous day's 1.1 percent gain on weaker Asian equities and a steady dollar, but losses were limited after industry data showed a surprise large drawdown in U.S. crude inventories. Crude for December delivery CLc1 fell 12 cents to $79.43 a barrel by 0647 GMT, after settling up 87 cents on Tuesday, its first rise in four days. London Brent crude LCOc1 was down 17 cents at $77.75. Japan's Nikkei share average hit a two-week closing low on Wednesday, while the dollar held gains against a basket of currencies. As the dollar strengthens, crude becomes more expensive for holders of foreign currencies. [.T] [FRX/] The American Petroleum Institute data showed after the contract's settlement on Tuesday that U.S. crude stocks fell by 3.5 million barrels last week, compared with a forecast for a 1.8 million barrel build in a Reuters poll. [API/S] The data showed, however, that U.S. gasoline and distillate supplies fell less than expected. [EIA/S] The API report is regarded as a precursor to more authoritative numbers issued by the U.S. Energy Information Administration at 10:30 a.m. EDT (1430 GMT) later on Wednesday.

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