U.S. crude fell $1.23 a barrel to $40.93 by 1500 GMT. London Brent crude was 25 cents down at $44.65 a barrel.

U.S. unemployment rose to a record peak in mid-January, while new orders for long-lasting manufactured goods fell for the fifth month in a row.

The feeble state of the U.S. economy was already illustrated by a larger-than-expected 6.2 million barrel rise in crude oil stocks last week, according to government data on Wednesday.

Stocks at Cushing, Oklahoma, the delivery point for U.S. crude oil futures, rose a further 300,000 barrels.

“U.S. crude has weakened against Brent again. The 300,000 barrel stock build in Cushing and the general crude stock build has caused this,” said Christopher Bellew, a broker at Bache Commodities in London.

“Run cuts and OPEC production cuts may offer some support,” he said.

OPEC Secretary General Abdullah al-Badri, speaking at the World Economic Forum in Davos, Switzerland, said OPEC would not hesitate to act again if the oil price remained low.

The Organization of the Petroleum Exporting Countries has pledged to cut supply by 4.2 million barrels per day since September last year to try to support oil prices, which have dropped more than $100 a barrel since July.

Badri said on Wednesday OPEC was expected to have delivered fully on its pledged supply curbs by the end of this month, but a weak economy would continue to erode demand for fuel.

OPEC next meets on March 15 to decide output policy.

Martin King, analyst with FirstEnergy Capital Corp, said OPEC had done a much better job of cutting supplies from the market than many had expected, setting the stage for a gradual price rebound in the second half of 2009.

“We see the crude market on the cusp of achieving real signs of stability, driven in part by tighter supplies out of OPEC.”

LONDON, Jan 29 (Reuters)

Oil prices fell towards $45 a barrel on Tuesday as the market began to anticipate data showing rising fuel inventories that reflect economic slowdown.

Prices had earlier advanced more than a dollar, boosted partly by cold weather in top energy consumer the United States, plus signs OPEC oil supply cuts may have begun to bite.

U.S. light, sweet crude for March delivery fell 66 cents to $45.07 a barrel by 1259 GMT. It earlier touched a session high of $47.49 a barrel and a session low of $44.40.

U.S. crude has rebounded from below $33 a barrel in the past week.

London Brent crude fell 92 cents to $46.04 a barrel.

“The retreat toward the lower end of the trading range is suggests the market is anticipating stock builds in the API figures,” said Christopher Bellew of broker Bache Commodities Ltd.

The American Petroleum Institute (API), an industry body, has moved publication of its weekly inventory report to 2130 GMT on Tuesdays from Wednesdays, a day earlier than official government inventory data released on Wednesday.

The government data is forecast to show that U.S. crude oil stocks rose a further 2.7 million barrels last week, the fifth straight week of gains.

Colder weather is expected to help draw down distillate stocks by 800,000 barrels, according to a Reuters poll. Gasoline stocks are likely to have risen by 1.3 million barrels.

ABOVE LOWS

The U.S. cold snap has helped prices move up from lows earlier in January of $32.7 a barrel, but analysts say the recovery may be temporary.

“Unless OPEC production cuts in January were substantially greater than what we have assumed, it is still too early to be calling an end to this current bear market,” Goldman Sachs said in a research note.

Oil’s supply/demand picture remains weak, Goldman said, pointing to a large counter-seasonal stock build in the United States and extremely weak demand in China, the world’s second largest energy consumer.

Oil has dropped more than $100 from a record peak above $147 a barrel in July last year, depressed by falls in demand as the credit crisis has pushed the global economy towards recession.

Goldman said retail investors were moving into oil, attracted by its low price, so that speculative positions or “length” in the oil market is now larger at $45 a barrel than it was at $147.

The Organization of the Petroleum Exporting Countries has agreed to reduce supply by 4.2 million barrels per day since September to try to support prices. The producer group is due to meet next in March.

A cyclone off western Australia has shut down nearly half of the country’s oil output, but some operators said production was likely to resume by Wednesday as the storm weakens.

Later on Tuesday, U.S. President Barack Obama goes to Capitol Hill to campaign for an $825 billion economic stimulus package to be put to a House vote within days.

LONDON, Jan 27 (Reuters)

Oil fell a dollar to below $43 a barrel on Thursday on weak economic data from the United States and China, the world’s two largest oil consumers.

The focus will shift later in the session to weekly U.S. fuel stocks data, which is expected to show crude inventories rose for a fourth consecutive week, and higher gasoline inventories.

U.S. crude fell $1.10 to $42.45 at 1510 GMT. Earlier in the session prices rose as high as $45.10. London Brent was down 3 cents at $44.99.

Prices came under pressure from another round of gloomy economic data.

The number of U.S. workers filing new claims for jobless benefits rose by more than expected last week, while housing starts and permits fell to a record low in December, data showed.

China’s economy slowed sharply in the fourth quarter and Japan’s central bank on Thursday predicted two years of deflation as Asia’s largest economies buckle under the strain of the financial crisis.

U.S. crude oil stocks are expected to have risen by 1.4 million barrels and gasoline by 1.9 million barrels in weekly data due at 1600 GMT on Thursday.

Traders were looking for news of the oil storage levels at the Cushing, Oklahoma, delivery point for NYMEX crude, which have been a drag on the nearby contract for U.S. crude futures.

European equities also pared early gains to turn negative, pressuring crude prices, traders said. Microsoft earnings missed expectations, contributing to a weaker opening for U.S. stocks.

Investors have been watching moves in equity markets to try and gauge the resilience of the broader economy, as the global economic slowdown has curbed demand for fuel around the world.

LONDON, Jan 22 (Reuters)

• The world’s biggest nuclear utility company, Electricité de France SA will offer as much as $6.5 billion for assets of Constellation Energy Group, Inc (CEG), source familiar with the matter told The Wall Street Journal. A previous offer by EDF was turned down, with Constellation opting for a $4.7 billion bid from Warren Buffett’s MidAmerican unit of Berkshire Hathaway Inc. (BRK.A,BRK.B).

• Research In Motion Ltd.’s (RIMM) third-quarter subscriptions and profit fell short of forecasts, as it simultaneously faces increased competition and recession in its largest market. Profit for the Blackberry maker rose no more than 83 cents a share in the quarter ended Nov. 29, well short of its goal of 97 cents, Bloomberg reported.

• Legg Mason fund manager Bill Miller said yesterday (Wednesday) that the “bottom has been made” in U.S. equities and that the Federal Reserve should purchase stocks and junk bonds to pull the United States out of the financial crisis Reuters reported. Miller said that all long-term investors believe that stocks today are cheap after acknowledging that his funds “performed far worse than I would’ve predicted we would” this year.

• Online retail spending rose 15% on “Cyber Monday,” the Monday immediately after Thanksgiving, from a year earlier, according to tracking firm comScore Inc. Consumers spent $846 million shopping online Monday, comScore said.

• Declining imports led to a surprise drop in U.S. crude oil stocks last week, the Energy Information Administration (EIA) said yesterday (Wednesday). Supplies of crude oil fell by 400,000 barrels to 320.4 million barrels in the week to November 28. Crude imports fell 1.46 million barrels per day (bpd), the IEA said.

• New Zealand’s central bank yesterday (Wednesday) cut its key interest rate by 1.5 percentage points to 5%, hoping to break the worst recession its faced in nearly two decades, Bloomberg reported. “Today’s decision takes monetary policy to an expansionary position,” Reserve Bank Governor Alan Bollard said in a statement in Wellington today. “Policy is working together with the depreciation of the New Zealand dollar and fiscal stimulus to create the conditions for some rebound in growth.”

Source: Global Investing Roundups Thursday, December 4th, 2008