* OPEC to enforce strict compliance, meet May 28
* World stock markets rise for fifth day
* Nigeria pipeline attack causes production outage
(Recasts, updates prices and dateline from previous LONDON)
By Edward McAllister
NEW YORK, March 16 (Reuters) - Oil rose 80 cents on Monday as a Wall
Street rally outweighed OPEC's decision not to cut production further.
U.S. stocks on Monday extended their recovery after major British Banks
joined their U.S. counterparts in hailing a strong start to 2009.
[]
U.S. light crude <CLc1> rose 80 cents to $47.05 a barrel by 1:58 p.m.
EDT (1758 GMT) after falling to as low as $43.62 a barrel earlier. London
Brent crude <LCOc1>, which expires Monday, was trading down 93 cents at
$44.00.
"With the OPEC headline risk now behind the markets, we believe OPEC's
decision not to cut production is a sign of strength, not weakness, and
expect the markets to rally in conjunction with the global equity markets,"
said Chris Jarvis, senior analyst, Caprock Risk Management, Hampton Falls,
New Hampshire.
Oil has tumbled $100 per barrel from highs above $147 in July last year
as the global economic meltdown has dented demand for oil worldwide.
An attack by suspected Nigerian militants on a Chevron oil pipeline in
the Niger Delta shut down around 11,500 barrels per day of output, the
company said Monday. []
In the oil rich Middle East, U.S. forces shot down an unmanned Iranian
aircraft in Iraqi airspace last month, a U.S. military spokesman confirmed
on Monday. []
INVENTORIES
OPEC met on Sunday and decided not to cut output further, but rather
concentrate on existing cuts that total 4.2 million barrels per day since
September.
The oil producing group's compliance with current cuts is estimated at
about 80 percent []. Full compliance would take 800,000 barrels
per day off the market.
Some analysts said OPEC's adherence to the existing cuts might be
enough to offset falling demand and reverse the recent increases in oil
inventories in many countries, including the world's largest oil consumer,
the United States.
"We believe the cuts made to date, coupled with falling non-OPEC
output, could already be enough to offset weaker demand and result in
observable inventory declines in the coming months," Collins Stewart said
in a research note.
The Organization of the Petroleum Exporting Countries will next meet in
May.
Ali al-Naimi, the oil minister of the world's top oil producer and
OPEC's most influential member, Saudi Arabia, said on Monday he was very
happy with OPEC's decision. []
In a preliminary Reuters poll ahead of the EIA inventory report
released Wednesday, analysts forecast a 0.5 million-barrel rise in U.S.
crude stocks for the week end March 13, a 300,000-barrel rise in distillate
stocks and a 1 million barrel fall in gasoline stocks.
(Additional reporting by Robert Gibbons and Gene Ramos in New York,
Ikuko Kao in London; Editing by John Picinich)
