Dec 5 (Reuters) -U.S. cotton futures rose over 1% on Tuesday after a large removal of certified stocks from ICE warehouses signaled export demand, and an upbeat oil market also bolstered appeal for the natural fiber.

* The second-month March contract CTc2 rose 1.05 cent, or 1.3%, at 79.73 cents per lb by 12:16 p.m. ET (1716 GMT). Prices were eyeing their best session in three weeks.

*Certified cotton stocks, which can be delivered against the contract, fell to 6,325 bales on Tuesday, from their highest level in over two years at 87,770 bales on Dec. 1, according to ICE data.

*"A whole lot of cotton was delivered mostly in Galveston and that implies some good export demand," said Jack Scoville, vice president at Chicago-based Price Futures Group.

*The biggest decline in certified stocks of around 67,700 bales came from the port city of Galveston, Texas, ahead of the December contract's expiry on Wednesday.

* "Cotton has followed crude oil over the last few weeks, and it has a large influence on cotton, it appears that the same people that are buying crude are buying cotton," said Rogers Varner, president of Varner Brokerage, in Cleveland.

* Oil prices climbs over 0.9%, making polyester, a cotton substitute, more expensive. O/R

* Elsewhere, Australia Cotton lint output for summer harvests is expected to be down 26% to 925,000 tonnes, according to ABARES.

* In the grain market, Chicago wheat futures edged down as the market watched to see if a hefty sale of U.S. wheat to China would herald a wave of export demand. Soybeans and Corn was little changed, with participants turning their attention to crop data later this week.

Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Krishna Chandra Eluri