* Renewed confidence in economic recovery lifts oil
* Lower U.S. demand widens gap in Brent-WTI prices
* Technicals show oil may rebound to $90.10/bbl
(Adds closure at Brent oil fields, updates prices)
By Florence Tan
SINGAPORE, Jan 24 (Reuters) - U.S. crude futures held above
$89 on Monday on renewed confidence that developed economies are
recovering and will boost demand for commodities.
Asian stocks rose on mild bargain buying while the euro
hovered near a near nine-week high before a two-day meeting by
the U.S. Federal Reserve this week expected to paint a cautious
view that the world's biggest economy is recovering.
"The sentiment is quite positive," Tetsu Emori, a
Tokyo-based commodities fund manager at Astmax Investments,
said, referring to signs of economic improvement in Europe and
in the U.S.
U.S. crude oil for March delivery rose 30 cents to
$89.41 a barrel at 0428 GMT, after posting a 2.65 percent loss
last week. ICE Brent crude for March rose 47 cents to
$98.07 a barrel.
Near record-high level of crude inventories at Cushing,
Oklahoma, the delivery point U.S. crude futures contracts,
depressed front-month futures and widened the gap against
European ICE Brent prices.
ICE Brent's premium to U.S. benchmark West Texas
Intermediate crude <CL-LCO1=R> reached $8.59 intraday on Friday,
its highest since February 2009, on tight North Sea crude
supplies and strong emerging market demand.
For a graphic on steep WTI contango, click:
http://graphics.thomsonreuters.com/AS/0810/UDS_20112401103638.jpg
Royal Dutch Shell said on Friday four North Sea
Brent oil and gas platforms, which shut down on Saturday, are
expected to remain closed for several weeks.
U.S. crude demand is set to fall with the onset of a peak
refinery maintenance season, Peter Beutel, president of U.S.
trading advisory firm Cameron Hanover, said in a note late
Friday.
"With the information that refineries had cut utilisation by
3.4 percent, the DOE (Department of Energy) signalled that
turnarounds have begun in earnest," he said.
Astmax's Emori said fundamentals in the oil market are still
much weaker than other commodities such as grains and metals.
"We don't see any tightness in the oil market at the
moment," he said, adding that the price gap between front and
back-month contracts may widen further.
However, traders will, at some stage, have to take profits
on the wide spread between Brent and WTI, Emori said, adding
that investors should remain cautious.
(Reporting by Manash Goswami; Editing by Manash Goswami)
