UPDATE 2-Brent over $114 near 9-month high on Iraq unrest

* Iraq asks U.S. for air support * U.S. crude stocks fall less than API forecast * Oil buoyed by Fed’s upbeat assessment of U.S. economy (Prices update) By Jacob Gronholt-Pedersen SINGAPORE, June 19 (Reuters) – Brent crude a held above $114 a barrel on Thursday, near a nine-month high, supported by concerns over potential supply disruptions due to fighting in Iraq. Brent was poised for a third day of gains after rising more than 4 percent last week after Islamic militants seized much of northern Iraq after defeating forces in Baghdad. “The oil market remains on high alert but is in a holding pattern at this stage, awaiting further developments in Iraq,” said Michael McCarthy, chief strategist at CMC Markets in Sydney. Brent crude was up 41 cents at $114.67 a barrel by 0706 GMT, after ending 81 cents higher at $114.26 a barrel, its highest settlement since Sept. 6 last year. U.S. crude for July delivery rose 51 cents to $106.48 a barrel. The contract, which expires on Friday, settled 39 cents lower in the previous session. “While US crude remains above $105.25 and Brent remains above $110.50, technically risks remain to the upside for both contracts,” McCarthy said. Oil prices found support after the US Federal Reserve gave a positive assessment of the country’s economy and pledged to maintain an accommodative monetary policy. However, U.S. crude fell on Wednesday after data from the U.S. Energy Information Administration (EIA) showed that domestic crude stockpiles fell by 579,000 barrels in the week ended June 13, much less than the 5 .7 million barrels reported by industry group American Petroleum Institute (API). ). A Reuters poll of analysts had expected a cut of 700,000 barrels. Crude inventories at Cushing, Oklahoma rose by 247,000 barrels – the first increase at the oil storage hub after nine straight weeks of declines. “This build is consistent with our long-standing view that the incentive to move barrels from Cushing to the Gulf Coast would eventually wane,” analysts at BNP Paribas said in a note. “But this latest build could initiate a selloff in West Texas Intermediate, especially given the recent price performance related to events in Iraq,” they said. IRAQ SEEKS AIR SUPPORT Concerns have arisen over Iraq’s ability to increase oil output or even maintain current levels after the head of state oil company South Oil Dhiya Jaffar said Exxon Mobil had carried out a “major evacuation” of their staff, and BP evacuated. 20 percent of its staff. Sunni militants have already taken control of Iraq’s largest oil refinery, located in Baiji in northern Iraq, a refinery official said on Wednesday. Iraq has asked the United States for air support to counter Sunni rebels, a senior American general said Wednesday, after the militants seized major cities in a flash advance. But General Martin Dempsey, chairman of the US military’s Joint Chiefs of Staff, did not give a direct answer when asked at a congressional hearing whether Washington would agree to the request. President Barack Obama came under pressure from US lawmakers on Wednesday to get Iraqi Prime Minister al-Maliki to step down over what they see as failed leadership in the face of an insurgency threatening his country. (Editing by Richard Pullin and Muralikumar Anantharaman)