* Oil may catch up with gains in other commods -fund
manager
* Technicals show oil to top five-month high
[]
* Coming Up: OPEC meeting, U.S. EIA weekly stocks; 1500 GMT
By Alejandro Barbajosa
SINGAPORE, Oct 14 (Reuters) - Oil rose for a second day on
Thursday, approaching five-month highs, dragged higher by a
broad-based rally in commodities as investors dump the dollar
in a flight to value-preserving assets.
U.S. crude for November <CLc1> climbed 74 cents to $83.75 a
barrel by 0308 GMT, approaching last week's peak of $84.43, the
highest since May 4, while ICE Brent added 55 cents to $85.19.
Improving fundamentals in the oil market, including falling
inventories in the United States, rebounding OECD demand and
soaring imports in China, are helping traders jump on the crude
bandwagon, as expectations mount for the U.S. Federal Reserve
to carry out a new round of expansionary monetary policy, known
in financial markets as quantitative easing.
"The crude oil market is behind other major commodities,
but it should catch up as risk appetite comes back because of
the potential quantitative easing," said Tetsu Emori, a fund
manager at Tokyo-based Astmax Co Ltd, adding that prices could
reach $100 by the second half of 2011.
The Organization of the Petroleum Exporting Countries
(OPEC), which meets in Vienna on Thursday, is not planning to
increase output to maintain prices within its preferred range
of $70-$80 a barrel. []
Instead, it is expected to leave production targets
unchanged and call for greater compliance with December 2008
output cuts.
Some OPEC members are eyeing prices higher than the
preferred range voiced by Saudi Arabian oil minister Ali
al-Naimi and other OPEC officials.
"We are looking to have next year an increase to between
$90 and $100 a barrel...to have a comfortable economy,"
Venezuelan Energy and Mines Minister Rafael Ramirez told
reporters in Vienna on Wednesday. []
STRONGER FUNDAMENTALS
U.S. crude inventories fell unexpectedly last week, partly
because of the closure of the Houston Ship Channel, shedding 4
million barrels compared to an expected increase of 1.1
million, the American Petroleum Institute (API) said on
Wednesday.
Gasoline and distillate stocks, including heating oil and
diesel, also fell by 1.9 million barrels and 254,000 barrels,
respectively, compared to forecasts from a Reuters survey for
drops of 1 million and 1.1 million barrels. []
Government statistics on U.S. stocks and demand from the
Energy Information Administration follow on Thursday at 1500
GMT.
Global oil demand growth is expected to accelerate for the
rest of this year, but is revised lower for 2011 and could slow
if the world economy disappoints, the International Energy
Agency (IEA) said on Wednesday. []
The U.S. Energy Information Administration on Wednesday cut
its 2011 oil demand growth forecast slightly, but also raised
its 2010 forecast. []
China imported a record amount of crude oil in September, a
third more than a year earlier, as demand in the world's
fastest growing oil market appeared to maintain a dizzying
pace, sparking talk it is building stocks. []
In other markets, the dollar index against a basket of
currencies <=USD><.DXY> fell to its lowest in nine months on
Thursday, down almost 0.7 percent on the day, rendering oil
imports cheaper for emerging economies, while the euro rose to
an eight-month high. []
The greenback had slipped against most currencies on
Wednesday after Federal Reserve meeting minutes released a day
earlier reinforced expectations of more monetary easing in the
United States. []
"Currently, for investors the conditions are one of the
best for the past five years," Emori said. "It's very positive
factors because governments have to sustain the economy and
employment."
World stocks jumped to a six-month high on Wednesday and
gold jumped to a new record on Thursday, while copper hit a
fresh 27-month high. []
French workers battling pension reform halted supplies from
most of the country's oil refineries on Wednesday and also
blocked some fuel depots as the risk grew of shortages at
petrol pumps. []
Only two of France's 12 oil refineries were operating
normally, with eight in the process of shutting down, unions
said, following blockages at plants due to a 17-day old strike
at the country's top oil port that has cut crude supply.
