* OPEC oil cuts supportive; U.S. crude stocks seen up
* IMF set for sharp cuts in global growth forecasts
* Reuters poll shows global demand to fall sharply in 2009
(Updates prices with settlements)
By Rebekah Kebede
NEW YORK, Jan 21 (Reuters) - Oil settled up 6.6 percent to
above $43 a barrel on Wednesday as OPEC supply cuts outweighed
additional evidence that a deepening global slowdown is
crushing demand for fuel.
U.S. light crude for March delivery <CLc1> settled at
$43.55, up $2.71 on its first day as the front month contract.
London Brent crude <LCOc1> rose $1.40 to $45.02 a barrel.
OPEC is fully enforcing its deepest ever oil supply curbs,
which should be enough to boost prices, the group's president,
Angolan oil minister Botelho de Vasconcelos, told Reuters.
Oil has plunged from record highs above $147 a barrel in
July as the global economic crisis lowered oil consumption,
prompting the Organization of the Petroleum Exporting Countries
(OPEC) to agree to a series of output cuts.
But despite the cuts, U.S. oil inventories have been
climbing steadily in recent weeks, with crude stocks at the
NYMEX delivery point in Cushing, Oklahoma, reaching a record
high and putting pressure on U.S. oil prices.
"Frankly, we don't know that inventories at Cushing,
Oklahoma, are going to just mount to the sky ... at some point,
the OPEC production cuts are going to rebalance the market,"
said Tim Evans, energy analyst for Citi Futures Perspective, in
New York.
"If the U.S. market is to sustain an ongoing flow of crude
oil, it will have to bid at a price level that is competitive
with the Brent market," he added.
Crude was also supported by the weakness in the U.S. dollar
against the euro and the yen.
FALLING DEMAND, HIGHER INVENTORIES
Wednesday's gains were tempered by mounting worries about
shrinking global oil demand as an economic slowdown takes hold,
dealers said.
The International Monetary Fund is set to sharply cut
growth forecasts this month, IMF Managing-Director Dominique
Strauss-Kahn said on Wednesday. []
The world will not return to strong growth for two to three
years, Strauss-Kahn said.
A Reuters poll on Wednesday showed industry analysts
expected global oil demand to contract by 430,000 barrels per
day in 2009, deeper than they had forecast previously, as the
economic crisis spreads to the developing world.
China, one engine in the recent oil rally, was expected to
release fourth-quarter GDP data this week that economists said
could show 7.0 percent growth, the slowest pace of expansion in
nearly a decade for the world's third-biggest economy.
Another Reuters poll of analysts forecast that crude oil
stocks in the United States, the world's top energy consumer,
rose by 1.4 million barrels last week.
Data will be released on Thursday, a day later than usual,
following the U.S. holiday on Monday honoring civil rights
leader Martin Luther King Jr.
(Additional reporting by Robert Gibbons and Gene Ramos in New
York, David Sheppard in London; Maryelle Demongeot in
Singapore; editing by Jim Marshall)
