UPDATE 4-Oil hovers near $80; demand outlook uncertain

* Market shrugs off jump in U.S. equities

* U.S. distillate stocks still brimming

* Focus turns to U.S. jobs data due out on Friday

(Recasts)

By Emma Farge

LONDON, Nov 5 (Reuters) - Oil hovered above $80 a barrel after a steep decline in U.S. crude inventories sent prices up 1 percent the previous day, as doubts about the pace of economic recovery in the world's largest fuel consumer tempered the rally.

U.S. crude for December fell 18 cents to $80.22 by 1615 GMT, after hitting a high of $81 a barrel the previous day after news that U.S. crude inventories fell by a larger-than-expected 4 million barrels. [EIA/S]

London Brent crude CLc1 fell 22 cents to $78.67 a barrel, after settling up 80 cents on Wednesday.