* Saudi Arabia says has taken 1.7 mln bpd off market
* U.S. crude inventories expected to rise
* EIA cuts oil demand forecast for 2009
* EU says countries receiving little Russian gas despite restart
(Recasts with new detail, updates prices, changes dateline from LONDON
previous)
By Rebekah Kebede
NEW YORK, Jan 13 (Reuters) - Oil prices rose 2 percent on Tuesday,
bolstered by cold weather in the United States and Saudi Arabia's comments
the OPEC nation had made deep cuts in production.
The news offset a report by the U.S. Energy Information Administration
further revising down its forecast for 2009 global oil demand.
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U.S. crude <CLc1> traded up 90 cents to $38.49 at 12:53 p.m EST (1754
GMT), off an earlier high of $39.50. February Brent <LCOc1> rose $1.86 to
$44.77 a barrel.
"This is a product-led rally, with heating rallying on cold
weather and gasoline up with the crack spread up dramatically. News that
the Saudis have cut production a lot is also supportive," said Andrew
Lebow, broker at MF Global.
Saudi Arabian Oil Minister Ali al-Naimi that the world's biggest
exporter would pump below its OPEC production target of 8.05 million bpd in
February.
"If there is a need to do more, we will do so because our purpose is to
bring things in balance," Naimi told reporters in New Delhi. "We will look
and see whether we need to take more. If we need to, if inventories keep
rising, we will reduce."
"We have taken -- Saudi Arabia alone -- 1.7 million (bpd)" (off the
market), he said.
OPEC's secretary general said the cartel may cut oil output further at
its meeting in March if the market remains oversupplied a month from now.
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OPEC agreed to cut supply by 2 million bpd at meetings in in September
and October. In December, it agreed to lower output by a further 2.2
million bpd as of Jan. 1, a record reduction.
Support also came from a blast of cold winter weather in the northern
hemisphere, which pushed up heating oil futures.
The global economic crisis has dented global energy demand and helped
send crude prices tumbling from record highs over $147 a barrel hit in
July.
The EIA revised down its 2009 world oil demand forecast by 200,000
barrels per day (bpd) on Tuesday, calling for consumption to fall by a
total of 810,000 bpd this year compared with 2008 levels.
"The demand was revised downward, but (the) decline in global demand
for 2009 looks rather small when measured against a 4.2 million barrels per
day drop in OPEC quotas," said Tim Evans.
U.S. crude oil stocks have swelled as demand in the top consumer wilts,
pushing U.S. crude futures into a deep discount compared with Brent crude.
Stock levels at Cushing, Oklahoma, the delivery point for U.S. crude
futures, have hit record levels and analysts expect inventories could rise
further.
A Reuters poll ahead of Wednesday's U.S. inventory report forecast
crude stocks rose by 2.2 million barrels last week, the third weekly gain.
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Russia started pumping gas meant for Europe via Ukraine on Tuesday for
the first time in nearly a week, but the European Union said little or no
gas was flowing to countries suffering urgent energy shortages.
[]
(Additional reporting by Gene Ramos in New York; Christopher Johnson and
David Sheppard in London, Fayen Wong in Perth and Chua Baizhen in
Singapore; editing by James Jukwey)
