NEW YORK, Dec 31 (Reuters) - U.S. crude oil futures slipped beneath $90 a barrel Friday as year-end profit taking overran bullish economic data and a drawdown in crude inventories. U.S. gasoline futures, however, remained upbeat, buoyed by holiday driving demand and lower inventory levels. Still, crude was set to close the year up more than 12 percent and average $79.60 a barrel, second only to 2008's record average of $99.75. FUNDAMENTALS * On the New York Mercantile Exchange, February crude CLG1 fell 53 cents, or 0.59 percent, to $89.31 at 8:53 a.m. EST (1353 GMT). * U.S. crude stocks fell by 1.26 million barrels to 339.43 million barrels in the week to Dec. 24, the Energy Information Administration said Thursday, less than the 2.6 million barrels drop analysts had expected. [EIA/S] * Crude stocks at the delivery hub for the U.S. futures contract at Cushing, Oklahoma, rose 245,000 barrels to 36.64 million barrels as of Dec. 24, according to the EIA. * Gasoline stocks fell 2.32 million barrels. Distillates rose 243,000 barrels, against analysts' expectations for a 600,000-barrel draw. * Initial claims for unemployment benefits in the United States fell to their lowest level in more than two years last week. This was the latest data in a series to suggest the recovery has picked up steam. Midwest factory activity grew in December at its fastest pace since 1988 and another report showed pending sales of previously owned homes rose more than expected in November. [ID:nN3097646] * OPEC output rose slightly in December as Nigerian supply increased, indicating the group has yet to boost production substantially in response to high prices, according to a Reuters survey. [ID:nWLA1960] MARKETS NEWS * U.S. stocks drifted lower on Friday as investors chose to grab profits after a recent rally in which the S&P closed at its highest since September 2008. [.N] * The U.S. dollar fell to its lowest in seven weeks against the yen in thin trade on Friday after stop losses were triggered around the 81.30 yen level. This came a few days after yields on U.S. treasury bonds retreated from recent highs. [USD/] * Gold rose on Friday, notching up its strongest annual performance since 2007 and marking a fifth straight month of gains in December, driven by a weaker dollar and global economic uncertainty. [GOL/] * Copper also hit a new record in Europe on the last trading day of 2010 on rock solid demand and supply prospects for the upcoming year and a weaker dollar. [MET/L] UPCOMING DATA/EVENTS * NYMEX January RBOB gasoline and heating oil contracts expire on Friday. 9:01 LAST NET PCT LOW HIGH CURRENT DAY AGO CHNG CHNG VOL VOL CLc1 89.55 -0.28 -0.3% 89.17 89.85 18,707 117,853 CLc2 90.38 -0.31 -0.3% 89.99 90.68 5,127 37,772 LCOc1 92.80 -0.29 -0.3% 92.36 93.12 26,512 110,395 RBc1 2.3960 0.0042 0.2% 2.3869 2.4010 742 20,307 RBc2 2.3890 0.0042 0.2% 2.3802 2.3966 2,770 26,853 HOc1 2.4774 -0.0080 -0.3% 2.4644 2.4837 673 18,401 HOc2 2.4928 -0.0071 -0.3% 2.4789 2.4995 3,714 29,679 * NYMEX crude oil for February CLc1 fell 28 cents to $89.56 a barrel by 9:01 a.m. in volume of 18,710 lots. (Reporting by Selam Gebrekidan; Editing by John Picinich)

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