Oil Rebounds From 21-Month Low on Possible Early OPEC Meeting

By Grant Smith

Nov. 13 (Bloomberg) -- Crude oil rose, rebounding from its lowest in 21 months, after a plan was put forward for OPEC to hold a full meeting in Cairo this month before its scheduled December gathering.

Ministers and officials from the Organization of Petroleum Exporting Countries are having consultations by phone and may expand the Nov. 29 Cairo summit for OPEC's Arab leaders to a full group meeting, according to a delegate. Oil earlier dropped below $55 a barrel as the International Energy Agency made the biggest cut to its oil demand forecast in 12 years.

``OPEC may decide to cut 1 million barrels per day at the Cairo OAPEC meeting at the end of the month,'' Johannes Benigni, chief executive officer of Vienna-based consultant JBC Energy, said today.

Crude oil for December delivery rose as much as 84 cents, or 1.5 percent, to $57 a barrel on the New York Mercantile Exchange. The contract traded at $56.81 a barrel as of 12:40 p.m. London time.

The contract earlier fell as much as $1.49, or 2.7 percent, to $54.67 a barrel, the lowest since Jan. 30, 2007.

The IEA, an adviser to 28 nations, cut its 2009 oil demand estimate by 670,000 barrels a day, or 0.8 percent, to 86.5 million barrels a day following weaker economic forecasts from the International Monetary Fund, it said in a monthly report today. The agency trimmed its outlook for 2008 for an eighth time this year, cutting its fourth-quarter assessment by 1 million barrels a day.

German Recession

The German economy entered its worst recession in at least 12 years as the global financial crisis curbs exports and spending, government data showed today. Last week, the IMF warned of the first simultaneous recession in the U.S., Japan and Europe in more than 60 years.

U.S. crude-oil stockpiles probably increased 1 million barrels in the week ended Nov. 7 from 311.9 million the week before, according to the median of 13 analyst estimates before the Energy Department report.

The department is scheduled to release its weekly report today at 11 a.m. in Washington. The report is being delayed by a day because the Veterans Day holiday on Nov. 11.

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net