* Saudi Arabia says world economy can handle $75-$80 oil
* Oil rises above 200-day moving average, eyes on $65
* Japanese exports show modest signs of recovery
* General Motors Corp moves closer to bankruptcy
(Updates prices)
By David Sheppard
LONDON, May 27 (Reuters) - Oil rose to a six-month high
above $63 a barrel on Wednesday after OPEC's biggest member
Saudi Arabia said the global economy had strengthened enough to
cope with oil at $75-$80 a barrel.
Speaking ahead of a meeting of the Organization of the
Petroleum Exporting Countries in Vienna on Thursday, Saudi Oil
Minister Ali al-Naimi said oil prices would continue to rise,
recovering from lows near $32 at the turn of the year.
[]
"The price rise is a function of optimism, better things are
coming in the future," Naimi told reporters in Vienna.
"We see offshoots of recovery," he added. "Demand is picking
up, especially in Asia."
The minister said OPEC did not need to change its output
policy, which has already seen the group agree to remove 4.2
million barrels per day of oil from the market in a bid to shore
up prices battered by recession.
U.S. crude oil for July delivery <CLc1> rose to touch $63.45
a barrel, the highest level since mid-November, before easing
slightly to trade up 64 cents at $63.09 a barrel by 1340 GMT.
London Brent crude <LCOc1> rose 79 cents to $62.03 a barrel.
Oil prices gained more than 1 percent on Tuesday, bolstered
by a jump in U.S. consumer confidence.
Signs of a modest recovery in Japanese exports on Wednesday
and improving consumer confidence in France and Sweden further
boosted expectations the world is slowly emerging from its worst
financial crisis in decades. []
However, the economic damage wrought by the crisis was clear
as General Motors Corp <GM.N> lurched closer to the biggest
industrial collapse in U.S. history after bondholders rejected a
deal. []
"We're not really seeing a strong recovery yet, but I think
OPEC are implying they don't see oil demand falling any
further," VTB Capital analyst Andrey Kryuchenkov said.
"Everyone talks about green shoots but we're not completely
out of the woods -- to see a real price rally we'll need to see
a larger pick-up in demand."
Global oil demand is seen falling at the fastest rate since
1981 this year, with the International Energy Agency, adviser to
28 industrialised nations, predicting a 2.56 million barrel per
day fall.
Crude inventories have risen to around 62 days of forward
cover, but expectations of a slight drawdown in U.S. crude
inventories are lending support to prices, analysts said.
A preliminary Reuters poll ahead of U.S. weekly inventory
data showed an average forecast of a 1.1 million drawdown in
crude stocks and a 1.8 million decline in gasoline stocks last
week. []
Data from the American Petroleum Institute has been delayed
by one day until Wednesday while U.S. Energy Information
Administration oil inventory data will be released on Thursday
due to the U.S. Memorial Day holiday at the start of this week.
Prices also shot above the key technical level of the
200-day moving average for the first time in more than eight
months, adding to some analysts' convictions that oil has found
a new price floor at $60 and may rise towards $65.
[]
(Additional reporting by Fayen Wong in Perth; Editing by
Anthony Barker)
