* OPEC cuts output unexpectedly by 520,000 bpd
* IEA cuts 2008, 2009 global oil demand growth forecasts
* U.S. data to show sharp falls in crude, fuel stocks
(Adds analyst comment, updates prices)
LONDON, Sept 10 (Reuters) - Oil rose on Wednesday in
response to a surprise decision by OPEC to cut production by
about half a million barrels a day.
The Organization of the Petroleum Exporting Countries had
been expected to keep existing output allocations but some
members had voiced concern about a growing surplus of oil on the
market as high prices have impacted demand.
U.S. crude <CLc1> was up 9 cents at $103.35 a barrel by 1236
GMT. On Tuesday, it fell to a five-month low of $101.74.
London Brent crude <LCOc1> was up 28 cents at $100.62, after
a fall below $100 on Tuesday for the first time since April.
"We think this is a serious deal for a real cut...In this
market, direction matters and this is a turn," UBS economist Jan
Stuart said in a report.
OPEC lowered its output targets to 28.8 million barrels per
day (bpd), a move the group's president said would reduce output
by 520,000 bpd. []
"Since the market is over-supplied, the conference agreed to
abide by September 2007 production allocations (adjusted to
include new members Angola and Ecuador and excluding Indonesia
and Iraq), totalling 28.8 million bpd," it said in a communique.
[]
The market drew additional support from reports of an
earthquake that struck southern Iran near Bandar Abbas, site of
a major Iranian oil refinery. []
Oil has fallen about 30 percent from a peak of $147.27 a
barrel on July 11, partly due to a fall in demand, a stronger
U.S. dollar and shifts in investment flows.
"There were enough surprises in Vienna to give some support
to the bullish camp, the question now is whether there is still
enough financial interest to play the game," said Olivier Jakob,
of energy analysts Petromatrix.
IEA
Price gains were limited as the International Energy Agency
lowered its 2008 world oil demand growth forecast by 100,000 bpd
due to the impact of weaker economic conditions and high prices.
[]
The IEA, adviser to 27 industrialised countries on energy
policy, also trimmed its forecast for 2009 global demand growth
by 40,000 bpd to 890,000 bpd.
The market is now likely to turn its focus to U.S. weekly
oil statistics due out later on Wednesday. []
Analysts in a Reuters poll expect U.S. government oil
inventory data to show a sharp fall in crude oil and refined
product stocks due to production and import disruptions caused
by Hurricane Gustav.
Crude oil stocks in the United States were seen falling 4.4
million barrels in the week to Sept. 5. Gasoline stocks were
seen down by 4.2 million barrels and distillates by 2.7 million
barrels.
Hurricane Ike's progress toward the U.S. Gulf of Mexico has
kept most oil and natural gas production shut in for a second
week. Its path has recently shifted south and west of the
biggest concentration of production platforms, aiming instead at
the Texas coast. [].
(Reporting by Ikuko Kao, Matthew Robinson, Jane Merriman in
London and Angela Moon in Seoul and Jonathan Leff in Singapore;
Editing by Anthony Barker)
