* Japan economy shrinks most since 1974
* Obama to sign stimulus bill Tuesday in Denver
* OPEC again cuts 2009 world oil demand forecast
(Updates prices, adds South Korea export figures)
By Fayen Wong
PERTH, Feb 16 (Reuters) - U.S. oil steadied at above $37 a
barrel on Monday, pausing from last session's 10 percent rally,
as investors took profits and sought further directions ahead
of the signing of a U.S. stimulus package this week.
U.S. President Barack Obama on Saturday hailed
congressional approval of a $787 billion economic stimulus bill
as a major milestone in the country's economic recovery and the
White House said he would sign the legislation on Tuesday.
U.S. light crude for March delivery <CLc1> eased 14 cents
to $37.37 a barrel by 0742 GMT, after gaining $3.53 on Friday.
London Brent crude <LCOc1> for April shed 2 cents to
$44.79, maintaining a premium to U.S. oil due to high stock
levels at the main U.S. storage hub in Cushing, Oklahoma.
"A lot of good news was already priced in on Friday, so the
market is probably taking profits amid a shortened trading
week," said Mark Pervan, senior commodities analyst at
Australia & New Zealand Bank.
"Also, there are quite a few key economic data coming out
of the U.S. this week that are likely to disappoint, so the
market is probably positioning ahead."
U.S. economic data due to be released on Tuesday include
manufacturing production in New York State and U.S. home
builder sentiment for February.
Oil's jump on Friday was largely boosted by renewed
optimism that the U.S. economic stimulus package could help
pull the economy out of a 14-month recession, while the gains
were further encouraged as traders booked profits by selling
the spread between front and second month futures contracts.
Still, analysts said downside risks for oil prices remain
high, as major economies struggle to get out of their worst
recession in decades.
Japan's economy shrank in the last quarter by its most
since the first oil crisis in 1974, hit by an unprecedented
slump in exports, which is likely to lead to more calls for
extra stimulus steps to fight the deepening recession.
The impact of the recession is similarly felt in
neighbouring South Korea where January exports performed worse
than initially estimated, with revised customs data showing
overseas shipments dropped a record 33.8 percent from a year
earlier. []
President Obama's aides warned Americans on Sunday not to
expect instant miracles from the $787 billion economic stimulus
bill he will sign this week, but said it would help eventually.
Oil prices have tumbled from their peak above $147 a barrel
last year, as the economic downturn has spread to all regions
of the world, cutting energy consumption.
World oil demand will contract more sharply than expected
this year due to the economic crisis, OPEC said on Friday, an
outlook that may bolster the case for further supply cuts when
the group next meets in March.
NYMEX will be closed on Monday for the U.S. Presidents' Day
holiday and will reopen on Tuesday. Electronic trading on CME
Globex and NYMEX Clearport are unaffected and will run on the
normal schedule.
Crude oil speculators on the New York Mercantile Exchange
reduced net long positions in the week to Feb. 10, data from
the U.S. Commodity Futures Trading Commission released on
Friday showed.
(Additional reporting by Dharmasari Haroun; Editing by Ramthan
Hussain)
