* U.S. consumer confidence hits record low in January
* U.S. home prices down record 18.2 pct in November
* Valero deepens refinery run cuts
(Adds analysts quotes on U.S. inventories in graphs 12-13)
By Matthew Robinson
NEW YORK, Jan 27 (Reuters) - Oil fell 9 percent on Tuesday
after bleak economic data from top energy consumer the United
States stirred demand concerns.
U.S. consumer confidence slipped to a record low in January, a
survey showed on Tuesday, as governments around the world offered
further help to banks and industries battered by the financial
crisis. []
U.S. home prices, meanwhile, plunged a record 18.2 percent in
November from a year earlier as the housing market remained in the
throes of a deep recession, Standard & Poor's data showed on
Tuesday. []
U.S. crude <CLc1> settled at $41.58 a barrel, down $4.15, or 9
percent, in the biggest percentage loss since Jan. 7. London Brent
crude <LCOc1> settled down $3.23 at $43.73 a barrel.
The global economic crisis has weakened crude demand,
especially in developed economies, and pushed prices off record
peaks over $147 a barrel struck in July.
British retailers gave their gloomiest forecast on record for
February on Tuesday in the Confederation of British Industry's
monthly survey, although data showed January sales were less
dismal than expected. []
"The economy is still a drag on demand," said Tom Bentz, an
analyst at BNP Paribas Commodity Futures Inc.
Governments strung together lifelines to rescue their battered
economies on Tuesday, with the $825 billion U.S. economic stimulus
bill advanced another step. []
Top U.S. refinery Valero <VLO.N> said it is cutting refinery
output and capital spending this year due to shrinking demand.
[]
U.S. inventory data to be released this week is expected to
show another build in stocks as consumption weakens, with a
Reuters poll forecasting a 2.9-million-barrel-build in crude
inventories last week. []
Colder weather is expected to help draw down distillate stocks
by 700,000 barrels, while gasoline stocks are expected to show a
1.6-million-barrel gain.
"Traders may be accounting for the possibility of a build
in U.S. crude stocks," said Joseph Arsenio, managing director
at Arsenio Capital Management in Larkspar, California.
"It looks like North American crude oil inventories are
nearing their maximum levels and unless demand surges, that
will continue to pressure NYMEX crude futures."
Data from the U.S. Energy Information Administration is due
out on Wednesday at 10:30 a.m. EST (1530 GMT), while the American
Petroleum Institute will be released at its new time, 4:30 p.m.
EST (2130 GMT) on Tuesday.
Rising inventories and slumping prices prompted producer group
OPEC to agree to a series of steep output cuts during the second
half of 2008.
Kuwait on Tuesday said it would support a further output cut
if needed, echoing comments by some of the other members of the
cartel. []
The Organization of the Petroleum Exporting Countries next
meets on March 15 to decide on output policy. Some analysts say
current cuts may be insufficient to end the steep drop in prices.
"Unless OPEC production cuts in January were substantially
greater than what we have assumed, it is still too early to be
calling an end to this current bear market," Goldman Sachs said in
a research note.
(Additional reporting by Robert Gibbons, and Gene Ramos in New
York, Jane Merriman in London and Jonathan Leff in Singapore;
Editing by Christian Wiessner)
