* Oil extends gains, hovers above $68 a barrel
* Analysts expect OPEC to cut by 1-1.5 million bpd
* Asian stock markets shrug off U.S. gains, extend losses
By Fayen Wong
PERTH, Oct 24 (Reuters) - Oil climbed further to above $68
a barrel, buoyed by expectations OPEC would announce oil output
cuts at an emergency meeting later in the day to shore up
prices that were languishing at 16-month lows.
OPEC ministers, anxious to arrest a deep price slide and
yet cushion a bruised economy, said on Thursday they had agreed
they must cut output, but had not decided by how much.
[]
Analysts polled by Reuters anticipate the cartel will
reduce output by between 1 million and 1.5 million barrels per
day. [].
U.S. light crude for December delivery <CLc1> was trading
up 66 cents or 1 percent at $68.50 a barrel in Globex
electronic trading by 0230 GMT, after rising as much as $1.66
earlier, adding to Thursday's gains of $1.09.
London Brent crude <LCOc1> rose 61 cents to $66.53.
"The oil markets are now focused on the outcome of the
upcoming OPEC meeting. Statements from OPEC officials indicate
that OPEC is likely to cut oil production targets, but the size
of the cut is uncertain," David Moore, a commodity strategist
at the Commonwealth Bank of Australia, said in a note to
clients.
Oil has plunged more than 50 percent from its record high
above $147 in July and touched a 16-month low of $65.90 on
Thursday as the financial crisis eats into energy demand in the
United States and other industrial countries.
OPEC President Chakib Khelil of Algeria said on Thursday
the producer group could consider cutting back its oil output
in several steps and added that he favours OPEC's reference
crude oil basket price at $90 to ensure energy projects go
ahead.
Iran suggested on Thursday that a 2 million bpd cut would
be needed to stabilise oil prices, while Qatar said at least a
1 million bpd reduction was required. []
But analysts said the slowing global economy could limit
the impact of any oil supply cuts OPEC might agree on to prop
up prices and that oil markets would remain influenced by
deleveraging and risk aversion.
"Extreme risk aversion remains at the top of the market
agenda in the current cyclical downturn," Harry Tchilinguirian,
a senior oil market analyst at BNP Paribas Commodity
Derivatives in London, said in a research note.
Bleak outlooks from world car makers and a barrage of job
cuts by major U.S. companies, including Chrysler and Xerox,
have deepened fears of an extended global recession and kept
the market on edge. []
Asian stocks fell on Friday, led by a 4 percent drop in
Japan's Nikkei average <>, as the global economic slowdown
slashed earnings prospects for an array of companies, forcing
investors to look to safer government bonds.
The grip of the financial crisis has reached far beyond the
banking sector, with electronics maker Sony Corp and U.S.
online retailer Amazon.com Inc <AMZN.O> cutting their outlooks
in the face of weakening consumer demand.
The number of U.S. workers filing new claims for jobless
benefits also rose by a larger-than-expected 15,000 last week,
government data on Thursday showed. []
(Editing by Ben Tan)
