* Oil recovers above $43 after 10 pct fall in 2 sessions
* Bearish builds in U.S. crude and distillates stocks weigh
* China loan growth strong, refinery runs pick up speed
* OPEC meeting may focus more on compliance than on new
cuts
(Updates headline, lead, prices; adds Chinese data, quote)
By Maryelle Demongeot
SINGAPORE, March 12 (Reuters) - Oil rebounded towards $43 a
barrel on Thursday after a 10 percent fall in the past two
sessions as faint signs of recovery showed through the latest
Chinese data and traders positioned for the weekend OPEC
meeting.
U.S. light crude for April delivery <CLc1> rose 50 cents to
$42.83 a barrel by 0650 GMT after falling more than 7 percent
on Wednesday, when a bigger than expected U.S. crude oil build
and a slump in Chinese imports triggered a wave of selling.
London Brent crude <LCOc1> gained 70 cents to $42.10.
While the latest figures from China showed industrial
output growth ground almost to a standstill at the start of the
year, data showing a continued surge in bank lending in
February fed optimism that activity could soon rebound.
[]
Showing similarly mixed signals, China's daily refinery
output fell 2.3 percent in February from a year ago, but
production improved after January's steep 9.4 percent drop, and
hit a four-month high. []
"It looks as if refinery output is up on expectations of
higher demand, rather than there actually being a rise in
demand. It's a tricky situation and could turn out very bad if
demand doesn't materialize," said Jonathan Kornafel, Asia
director of U.S.-based Hudson Capital Energy.
Demand issues have moved to the front as the global
economic slowdown has slowed consumption and sent oil prices
off peaks over $147 a barrel hit in July, prompting the
Organization of the Petroleum Exporting Countries (OPEC) to cut
supplies by 4.2 million barrels per day since September.
The group meets on Sunday, with some members calling for
another output cut and others insisting greater compliance with
current agreements is needed.
Saudi Arabia, the biggest and most influential of the
12-member group, is among those which believe it is too soon to
agree new output targets, sources have said. []
"The braver fundamentally-based decision would be no
change, but we believe the decision most likely to maintain
some upwards price momentum would involve further ratcheting up
of the supply-side pressure," Barclays Capital said in a
report.
Signs of still slow demand in the U.S. sent prices down 7
percent on Wednesday after weekly stocks data released by the
U.S. Energy Information Administration (EIA) showed a
larger-than-expected 700,000 barrel build in crude inventories
together with a large 2.1 million barrel rise in distillates
stocks.
"Heating oil stocks posted a second counter-seasonal rise.
Diesel stocks are still building, reflecting underlying
weakness in the economy," French bank BNP Paribas said in its
US weekly statistics comment report.
The market downplayed a bullish 3 million barrel draw in
gasoline stocks as demand for the product was off on the week,
even though demand for the past four weeks was at 9.02 million
barrels per day, up 1.6 percent from a year ago.
The data, coming after the EIA revised down its demand
forecast again a day before for the 11th time in 14 monthly
report, compounded the bearish sentiment after Chinese customs
data showed a large 15 percent fall in crude imports in
February.
(Editing by Clarence Fernandez)
