* Cold weather, geopolitical concerns lift oil futures
* Reuters oil poll shows higher price estimates
* Coming up: CFTC commitments report, 3:30 p.m. EST Monday
(Recasts, updates prices and market activity, new byline and
changes dateline from previous LONDON)
By Robert Gibbons
NEW YORK, Nov 29 (Reuters) - Oil prices rose on Monday as
Europe's cold weather and hopes for revived consumer demand
lifted refined products futures and the oil complex despite a
strong dollar and fears the rescue plan for Ireland might not
contain Europe's debt woes.
As the euro weakened and the dollar rallied on concerns the
debt crisis could spread within the euro zone, Wall Street
stocks fell in early trading. Oil briefly turned negative but
bounced back as refined products led the charge higher.
Temperatures remained colder than normal and heating demand
above average in Northeast and Northwest Europe [],
providing a boost to London gas oil <LGOc1> and U.S. heating
oil <HOc1> distillate futures as the U.S. December refined
products contracts near their Tuesday expiration.
A shut arbitrage between Europe and the United States and
recent tight supplies in the New York Harbor region helped
support U.S. gasoline futures. []
U.S. crude oil for January delivery <CLc1> rose $1.47 to
$85.23 a barrel at 12:45 p.m. EST (1745 GMT), having reached an
$85.54 peak intraday.
The front-month crude price has seesawed after reaching a
25-month peak at $88.63 on Nov. 11. It has not dropped below
$80 since Oct. 20.
Total U.S. crude trading volume was above 350,000 lots
after midday in New York, 45 percent below the 30-day average.
In London, ICE January Brent crude <LCOc1> rose $1.36 to
$86.94 a barrel.
News of strong "Black Friday" U.S. retail sales suggested a
revival in consumer buying. Expectations that strong online
gift buying could boost demand for delivery transportation had
some analysts pointing to improving fundamentals for oil.
"The southern European sovereign debt crisis would have to
take a severe turn for the worse to derail positive commodity
price trends that are finding strong support from improving
fundamentals and positive market sentiment towards growth
assets," Barclays Capital analysts said in a report.
A Reuters oil price poll showed most analysts revising
price estimates higher [], while a Reuters survey of OPEC
showed slightly better compliance with production curbs.
[]
Adding to the bullish picture, U.S. oil demand in September
was revised higher, the U.S. Energy Information Administration
said on Monday. []
GEOPOLITICAL RISKS
"Crude prices have rallied on increased geopolitical risk,
following the revelations related to the Wikileaks disclosure
of secret U.S. diplomatic cables," said Phil Flynn, analyst at
PFGBest Research in Chicago.
"Also adding to geopolitical risk is the continued tension
in the Korean Peninsula."
South Korean President Lee Myung-bak labeled North Korea's
artillery attack on a west coast island a crime against
humanity and said the South would retaliate against any further
provocation. []
Tensions between North and South Korea have been seen as
ultimately bearish for oil prices because war would curb Asian
demand, but the simmering hostilities remain a wild card.
Saudi Arabia's King Abdullah has repeatedly urged the
United States to attack Iran's nuclear installations, according
to U.S. diplomatic cables released on Sunday in an embarrassing
leak seen as undermining to U.S. diplomacy. []
EURO ZONE WORRIES AND DOLLAR STRENGTH
Finance ministers from the 16-nation euro zone unanimously
endorsed an emergency loan package of 85 billion euros ($115
billion) to help Dublin cover bad bank debts and bridge a huge
budget deficit. []
Germany and France said Europe had acted decisively to save
the euro by rescuing Ireland and agreeing the basis of a
permanent debt resolution system, but underwhelmed markets
drove debt costs higher. []
The dollar index <.DXY> strengthened and the euro lost
further ground, breaking below key support around $1.3080, the
50 percent Fibonacci retracement of its rise from June to
November, signaling further downside pressure. []
A stronger dollar typically pressures oil prices as it
boosts the value of greenbacks paid to producers for
dollar-denominated oil while making it more expensive for
consumers with other currencies.
(Additional reporting by Gene Ramos in New York,
Christopher Johnson and Dmitry Zhdannikov in London and
Alejandro Barbajosa in Singapore)
