* World stock markets rise for fifth day
* OPEC to enforce strict compliance, meet May 28
* Nigeria pipeline attack causes production outage
(Updates prices at settlement)
By Edward McAllister
NEW YORK, March 16 (Reuters) - Oil rose over $1 per barrel
on Monday as Wall Street and global stock market rallies
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> settled up $1.10 at $47.35 per
barrel after falling to as low as $43.62 earlier. London Brent
crude <LCOc1>, which expires Monday, settled down 95 cents, at
$43.98.
"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 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. []
In the oil rich Middle East, U.S. forces shot down an
unmanned Iranian aircraft in Iraqi airspace last month, U.S.
and Iraqi officials said, an incident that highlights deep
U.S.-Iranian tensions. []
INVENTORIES
The Organization of the Petroleum Exporting Countries 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," investment bank Collins Stewart said in a
research note.
Ali al-Naimi, the oil minister of the world's top oil
producer and OPEC's most influential member Saudi Arabia, said
he was very happy with OPEC's decision. []
OPEC producers said they would meet again at the end of May
to review progress.
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 ending
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 Marguerita Choy)
