* U.S. gasoline, distillates fall; crude stocks rise
* Fed keeps rates between zero and 0.25 pct
* OPEC chief sees supply curbs delivered by end-Jan
* Equities rally, weaker dollar lend support
(Recasts, updates prices, market activity)
By Rebekah Kebede
NEW YORK, Jan 28 (Reuters) - Oil prices rose on Wednesday
after U.S. government data showed draws in gasoline and
distillate inventories and OPEC vowed to fully implement its
steep supply cuts by the end of the month.
U.S. crude <CLc1> settled at $42.16 a barrel, up 58 cents,
after plunging 9 percent on Tuesday as bleak U.S. economic data
stirred demand concerns.
London Brent <LCOc1> settled at $44.90, up $1.17.
Oil prices climbed after data released by the U.S. Energy
Information Administration showed a 1-million-barrel draw in
distillate stocks last week as cold weather hit the U.S.
Northeast, the world's top heating oil market, and a surprise
100,000 barrel fall in gasoline supplies. []
"It looks like the products are kind of stabilizing the
whole complex right now," said Tom Bentz, senior commodity
analyst at BNP Paribas Commodity Futures, Inc in New York.
Crude stocks rose sharply, however, up 6.2 million barrels,
as refiners facing weak fuel demand slowed operations.
"Another flood of crude. We are getting overwhelmed by
crude," said Phil Flynn, analyst at Alaron Trading in Chicago.
U.S. crude stocks have risen more than 44 million barrels
in the past four months, the biggest four-month increase since
1990, according to EIA data, as refiners put oil in storage
instead of into processing units.
Oil prices also recieved a boost from remarks by OPEC
Secretary General Abdullah al-Badri at the World Economic Forum
in Davos, Switzerland, that even an oil price of $50 a barrel
was too low to encourage investment in new supply and added
that the cartel would fully enforce supply curbs by the end of
this month. []
OPEC has agreed to shave some 4.2 million barrels per day
of production since September to counter the free-fall in oil
prices from record peaks over $147 in July.
Oil also found support as Wall Street rallied following the
Federal Reserves announcement that it was prepared to buy
longer-term Treasuries to improve credit market condition.
[]
"There was a stock market rally on the FOMC statement, and
crude futures rallied as well. The underlying hope is that with
the FOMC's stated goals, the economy would improve and with
that demand for oil would improve as well. But everybody knows
we are long way from that, and that realization spurred some
late selling," Andy Lebow, a broker at MF Global in New York
said.
Traders had also been watching for the Federal Reserves
decision on official borrowing costs, which the Fed held in a
range of zero to 0.25 percent, as expected. []
(Reporting by Rebekah Kebede and Richard Valdmanis in New
York, Chua Baizhen in Singapore and Peg Mackey and Alex Lawler
in London; Editing by Christian Wiessner)
