* Gold hits highest since Oct. 10
* IMF to cut global growth forecast further to 1-1.5 pct
(Updates prices)
By Christopher Johnson
LONDON, Jan 26 (Reuters) - Oil rose towards $47 a barrel on
Monday, but held in a narrow range, drawing some support from
the perception that supply cuts by OPEC oil producers are
beginning to put a floor under prices.
U.S. light crude for March delivery <CLc1> rose 21 cents to
$46.68 a barrel by 1314 GMT. The contract had risen $2.80, or
6.41 percent, to $46.47 a barrel on Friday, crowning a rebound
in the front-month contract from below $33 a barrel a week ago.
London Brent crude <LCOc1> was 11 cents up at $48.48 a
barrel.
"The OPEC cuts are not sufficient to cause prices to move
up, but they are enough to stabilise the market until demand
begins to recover," Christopher Bellew, broker at Bache
Commodities in London, said.
"Essentially the market is range-bound between $40 and $50,
basis Brent," he said.
The main driver of the rally in oil prices on Friday was
evidence of OPEC making good on most of its pledged 2.2 million
barrel a day (bpd) production cut this month.
Oil consultant Petrologistics estimated OPEC output would
fall by 1.55 million barrels per day in January. []
OPEC has pledged to cut output by a total of 4.2 million
barrels per day since September to try to halt a more than $100
fall in oil prices since July.
These supply cuts are starting to have some impact, but the
fragile state of the global economy and weak energy demand is
preventing any sustained rally in the oil market.
An International Monetary Fund official said on Sunday the
agency will cut its 2009 global growth forecast again, this time
to between 1-1.5 percent from a previous estimate of 2.2
percent, as economic conditions deteriorate. []
Oil demand is closely tied to economic growth and many
economists now predict a fall in energy use this year as
recession hits most of the large developed economies.
Gold rose to its highest in more than three months, boosted
by its attractions to investors as a safe haven in turbulent
economic conditions. <GOL/>
European shares were higher, led by a recovery in financial
stocks. <.EU>
"Higher equity prices are influencing sentiment, as traders
are still watching moves in the broader economy to try and gauge
where demand is going to be in the months to come," said Andrey
Kryuchenkov, analyst at VTB Capital.
Crude oil speculators on the New York Mercantile Exchange
trimmed new long positions in the week to Jan. 20, according to
U.S. Commodity Futures Trading Commission data. []
(Additional reporting by David Sheppard, Peg Mackey and Jane
Merriman in London and Fayen Wong in Perth; editing by Anthony
Barker and Sue Thomas)
