* OPEC should make severe output cut, says president
* Russia says ready to work with OPEC on output cuts
* Dollar up vs euro after hitting seven-week low overnight
By Jennifer Tan
SINGAPORE, Dec 12 (Reuters) - Oil fell to around $47 a
barrel on Friday on a recovering U.S dollar, after a near 10
percent jump overnight as OPEC's president called for more
"severe" supply cuts at next week's meeting.
The dollar pulled back from seven-week lows against the
euro, although further pressure on the greenback could come
from a slew of U.S. economic data due later.
By 0210 GMT, crude for January delivery <CLc1> was down 91
cents at $47.07 a barrel, off a session low of $46.72 earlier.
It had settled up $4.46, or 10.3 percent, on Thursday in the
biggest single-day percentage gain since Nov. 4.
Crude has rebounded nearly 15 percent this week, on track
for its biggest weekly gain since Jan. 16, 2000, after having
shed two-thirds of its value over the last five months.
London Brent crude <LCOc1> was down 92 cents at $46.47.
Oil prices have lost about $100 from a record peak of
$147.27 scaled last summer as the global financial crisis
crimps consumer demand for fuel.
The dollar rose against the euro on Friday after hitting a
seven-week low the previous day, but the U.S. currency is
likely to face downward pressure on a likely interest rate cut
next week by the Federal Reserve. []
Data due later in the day, including November producer
price inflation and retail sales, as well as a preliminary
reading on December consumer confidence, could make grim
reading for the world's largest oil consumer. []
"The slight strengthening of the U.S. dollar against the
euro is prompting some selling of crude, as commodities are
generally seen as a hedge against a weaker dollar," said Jim
Ritterbusch, president of Ritterbusch & Associates.
He added the weak U.S. currency would be a much larger
influence on crude prices, compared to the anticipated supply
cut by OPEC next week.
"We've not placed the lows in oil yet -- the demand
deterioration theme is still very much alive. I think we could
go back to $40 levels as early as next week."
Oil's strong gains the previous day came after OPEC
President Chakib Khelil said in remarks published that OPEC
should agree on a more "severe" reduction in output at the Dec.
17 meeting in Algeria. []
Traders are closely watching OPEC for any more signals on
what some analysts perceive could be a further 1-2 million
barrels per day output cut due at the group's meeting next
week.
Support also came after Russia's President Dmitry Medvedev
said the country was ready to work with OPEC on possible oil
output. []
A prediction from the International Energy Agency that
world oil demand growth would rebound in 2009 after shrinking
this year for the first time since 1983 also helped the market.
[]
The IEA's view that demand will grow in 2009 contrasts with
that of the U.S. government's Energy Information
Administration, which this week forecast consumption would fall
by 450,000 barrels per day (bpd) next year.
Saudi Oil Minister Ali al-Naimi said the world's largest
exporter pumped 8.49 million barrels per day of oil in
November, less than estimated by analysts and in line with its
OPEC target.
That would put the kingdom's output at 560,000 bpd less
than the IEA's estimate of Saudi November production, published
earlier on Thursday, of 9.05 million bpd.
(Editing by Michael Urquhart)
(jennifer.tan@thomsonreuters.com; +65-6417 4679; Reuters
Messaging: jennifer.tan.reuters.com@reuters.net)
