Oil held above $47 a barrel today, as dealers mulled OPEC output options at a meeting this weekend and ahead of weekly US stocks data expected to show another fall in inventories.
OPEC's largest member, Saudi Arabia, notified its Asian customers of largely steady cuts in supplies for April from March, traders said today, a day after a Saudi-owned newspaper reported that the world's top exporter wanted stricter compliance with existing curbs before considering more cuts.
US light crude for April delivery rose 45 cents a barrel to $47.52 by 0704 GMT, having gained more than 3 per cent yesterday, on OPEC's hints of further cuts and after a naval incident between the United States and China.
London Brent crude was up 71 cents at $44.84 after settling 72 cents lower yesterday at $44.13.
OPEC will meet on Sunday to discuss more curbs to add to its current 4.2 million barrel per day (bpd) cuts agreed since September as oil prices have lost $100 from a record high of over $147 a barrel hit in July as the economic crisis crimps demand.
OPEC secretary-general Abdullah al-Badri said yesterday the 12-member producer group would consider reducing output again at the meeting. OPEC will slash its 2009 demand forecast by 1 million barrels per day (bpd) in a monthly report due on Friday, Mr Badri also said.
The US Energy Information Administration (EIA) will release later today its monthly short-term energy outlook, which will likely contain a cut in its demand forecast.
EIA's forecast is the first of three widely watched reports on world petroleum use to be released this week. The EIA has lowered its estimate for 2009 global oil demand in 10 out of its last 13 monthly forecasts.
Compliance with existing curbs is very high at more than 80 per cent, according to independent observers, but that still leaves room for more discipline.
Industry group the American Petroleum Institute will release at 2030 GMT its weekly US stocks data, which analysts forecast would show a bullish 400,000 barrel decline in crude stocks as inventories fall further from February's record highs.
Last week, crude stocks fell by an unexpected 700,000 barrels.
Analysts polled also expected an 800,000 barrel fall in gasoline inventories and a 200,000 barrel rise in distillates stocks.
The US Energy Information Administration will release its weekly data tomorrow.
Reuters