* Crude stocks up 4.7 mln barrels, dwarf forecast - API
* U.S. housing market shows signs of recovery
* Eyes on U.S. EIA inventory data at 10:30 EDT (1430 GMT)
(Updates throughout, previous PERTH)
By Christopher Johnson
LONDON, March 18 (Reuters) - Oil fell from a 2-1/2-month
high to below $49 a barrel on Wednesday after industry data
showed large builds in U.S. crude stocks.
Analysts said data from the American Petroleum Institute,
showing crude stocks rose much more than expected last week,
reflected poor demand at refineries and could foreshadow an
equally poor set of numbers from the U.S. Energy Information
Administration due later on Wednesday.
U.S. light crude for April delivery <CLc1> fell 35 cents to
$48.81 a barrel by 0945 GMT. On Tuesday, the contract gained
$1.81 to $49.16, its highest settlement since Dec. 1, 2008.
London Brent crude <LCOc1> slipped 36 cents to $47.88.
Oil has tumbled $100 from a record high of almost $150 in
July as economic meltdown has cut demand for fuel worldwide.
But prices, which sank to levels below $35 a month ago, have
since stabilised in the $40 to $50 range, as producer group OPEC
has targeted output cuts of 4.2 million barrels per day (bpd)
since last September and vowed at its Sunday meeting to achieve
higher compliance from members to reduce production.
Oil's gains on Tuesday were boosted by better-than-expected
U.S. housing data and inflation, which drove U.S. stocks higher
and lifted investors' risk appetite.
AWAITING MORE DATA
Broker MF Global said in its daily note to clients that
while Tuesday's U.S. housing figures had been supportive, "it
will take far more than one set of monthly figures to turn
sentiment (let alone the economy) around."
"In view of the fact that OPEC has decided not to put
through any additional cuts, we find it hard to rationalise a
sustained push beyond this mark," it said.
"The combination of all these variables makes the case that
some length should be taken off the table here, as the energy
markets have done too much, too soon given the prevailing
fundamental and technical backdrops."
The American Petroleum Institute (API) said in its inventory
report on Tuesday that domestic crude stocks rose 4.7 million
barrels last week to 349.9 million, dwarfing forecasts for an
increase of just 1 million barrels. []
The U.S. Energy Information Administration (EIA) will issue
stock data later on Wednesday, with crude oil inventories seen
up last week as refinery demand remained tepid and imports
increased a little, a Reuters poll showed. []
Government data on Tuesday showed U.S. housing starts and
permits rebounded in February from record lows, rising for the
first time in 10 months and offering a glimmer of hope for the
recession-hit economy. []
Still, analysts were cautious about whether the housing data
marked a turnaround for the world economy and said the market
would keep a close eye on further data to gauge how the U.S.
economy was faring.
Data due to be released later on Wednesday included U.S.
core consumer price index for February as well as results of an
interest rate meeting held by the U.S. Federal Open Market
Committee.
(Additional reporting by Fayen Wong in Perth; editing by James
Jukwey)
