* European stocks higher despite poor German GDP numbers
* Dollar gains against euro
* World oil demand to fall at fastest rate since 1981 -
IEA
(Updates prices)
By Chua Baizhen
SINGAPORE, May 15 (Reuters) - Oil prices paused below $59
on Friday as European equities opened higher, shrugging off
gloomy German economic data and a firmer dollar.
Europe's main stock indexes started stronger on Friday
despite data showing Germany's gross domestic product (GDP)
plunged by a record 3.8 percent quarter on quarter in the first
three months of the year, much worse than expected.
[]
U.S. crude for June delivery <CLc1> was unchanged at $58.62
a barrel at 0737 GMT, and London Brent for July delivery
<LCOc1> fell 16 cents to $58.43 in its first session of trade
as the new front-month contract.
Crude prices were steady from last week's close, after
moving in lockstep with the stock market and rising against a
bearish report by the IEA a day earlier.
"Equities and currency are most important. The $60 price
level is also very important," Tetsu Emori, a fund manager at
Tokyo-based Astmax Co Ltd, said.
The dollar gained against the euro after the release of
Germany's disappointing GDP numbers. A stronger dollar makes
oil more expensive and less attractive to holders of other
currencies. []
U.S. oil prices breached $60 a barrel during intraday
trading on Tuesday but settled below $59 after the U.S.
Department of Energy slashed its 2009 oil demand forecast.
Oil prices have been tracking equities markets in recent
months as traders look to stocks for signs of an economic
recovery that could lift ailing world fuel demand.
While Germany's GDP figures weighed on optimism for the
economy, preliminary data out of France showed the country's
first-quarter GDP met expectations, falling 1.2 percent from
the previous quarter. []
"I don't expect oil demand to recover any time soon,"
Astmax's Emori said.
Paris-based IEA, an adviser to 28 industrialized nations on
energy policy, forecast a day earlier that world oil demand
this year would fall the most since 1981. []
IEA said the rise in oil prices to a six-month high above
$60 this week was due to sentiment rather than fundamentals.
The U.S. Energy Information Administration and OPEC also
cut their forecasts for energy demand in recent days.
The Organization of the Petroleum Exporting Countries
(OPEC), which has announced 4.2 million bpd of production cuts
since September in a bid to tighten the market, also pumped
more oil last month than in March, the IEA said.
OPEC members' compliance with production quotas fell to 78
percent in April from 83 percent a month earlier.
Traders will take cues from more economic indicators out of
the United States due later in the day, as well as renewed
unrest in Nigeria, Africa's biggest oil producer.
Nigerian militants have hijacked two cargo ships in the
Niger Delta and given oil companies until Saturday to evacuate
staff, warning they would attack helicopters and planes after
the deadline, after heavy clashes with the military.
[]
U.S. economic data expected later include April consumer
price index, the Reuters/University of Michigan survey of May
consumer sentiment and ECRI weekly index of economic activity.
(Editing by Ben Tan)
