* U.S. Congress set to approve $789 billion stimulus package
* OPEC again cuts 2009 world oil demand forecast
* OPEC figures suggest 65 percent compliance on output cuts
(Updates throughout)
By Christopher Johnson
LONDON, Feb 13 (Reuters) - U.S. oil futures rose towards $35
a barrel on Friday, snapping a five-day losing streak ahead of
the expected approval of a $789 billion stimulus package by the
U.S. Congress to help dig the economy out of recession.
The Democratic-controlled House of Representatives and
Senate were expected later on Friday to approve the emergency
package to create or save 3.5 million jobs and hand President
Barack Obama a big political victory.
The United States is the world's biggest oil consumer and
the economic slowdown that started in the U.S. housing market
more than a year ago has undermined energy demand, sending shock
waves through the oil market.
Oil prices have fallen more than 70 percent from their peak
at almost $150 a barrel last year as economic downturn has
spread to all regions of the world.
U.S. crude <CLc1> for March delivery rose 60 cents, or 1.8
percent, to $34.58 a barrel by 1328 GMT, after falling $1.96 in
the previous session to settle at $33.98 a barrel, its lowest
since Dec. 19.
London Brent crude for the new front-month of April <LCOc1>
fell 50 cents to $45.53 a barrel.
The Brent March contract expired on Thursday at $44.65,
extending its premium to U.S. crude to more than $10, mainly due
to a glut at the main U.S. storage hub in Oklahoma.
But the Brent premium for the April contract was less than
$4, and some analysts expect inventories to ease eventually at
Cushing, Oklahoma, the delivery point for the U.S. futures
contract, based on West Texas Intermediate (WTI) crude.
OIL DEMAND CONTRACTING
"We expect the energy markets to send mixed signals over the
weeks ahead," MF Global said in its daily commentary.
"March WTI should be under continued pressure, as it
approaches expiration on the 20th, this similar to weakness
experienced by both the December and January contracts before
it. Brent, on the other hand, should remain firm as OPEC cuts
take hold."
The Organization of the Petroleum Exporting Countries said
on Friday world oil demand would contract more sharply than
expected this year due to the economic crisis.
Making a possible case for further supply cuts, OPEC said in
its monthly report that global demand would fall by 580,000
barrels per day (bpd) in 2009 to average 85.13 million bpd. Its
previous forecast was for demand to contract by 180,000 bpd.
OPEC, which pumps more than a third of the world's oil, has
agreed at meetings since September to cut its oil output by 4.2
million bpd, equal to 5 percent of daily world demand, to combat
the slump in prices and demand.
The report said OPEC still had more to do in delivering
existing output promises, suggesting OPEC met 65 percent of its
pledge to lower output, according to a Reuters calculation based
on the OPEC data.
U.S. oil prices have lost about 14 percent this week and are
languishing at a three-week low, pressured by persistent demand
worries and doubts over the efficacy of the U.S. government's
banks rescue plan.
Oil's losses on Thursday were exacerbated by news that the
number of people staying on unemployment benefits in the United
States rose by 11,000 to a record of 4.810 million in the last
week of January. []
In the short term, analysts believe the market's direction
would be influenced by movements in stock markets.
European stocks rose on Friday, supported by reports of the
imminent passage of Washington's stimulus package. U.S. stock
futures also signalled that Wall Street would open higher, also
buoyed by the plan. [] []
(Additional reporting by Fayen Wong in Perth; editing by James
Jukwey)
