Oil futures rose near $42 a barrel today, buoyed by threats of major strikes by refinery workers in the United States and Britain, but the gains were tempered by concerns of sagging global energy demand.
Signs from OPEC late last week that it may augment its record output cuts to stem the collapse of more than $100 in prices, and an abrupt end to a ceasefire in Nigeria's oil-rich Niger delta also supported prices, analysts said.
US light crude for March delivery rose 22 cents to $41.90 a barrel by 4am, after gaining as much as 63 cents in early trade. The contract settled 24 cents higher at $41.68 on Friday.
London Brent crude rose 42 cents to $46.30.
"The slew of economic and oil demand data which came out of the US last week was all pretty negative energy demand outlook," said David Moore, a commodity analyst at the Commonwealth Bank of Australia.
"But threats of refinery strikes on both sides of the Atlantic are probably giving oil some support."
United Steelworkers negotiators and oil company representatives returned to the bargaining table on Sunday, one day after telling thousands of US refinery and chemical plant workers to stay on the job as they try to hammer out a new national
contract.
The USW decided on Saturday night to extend the current pact on a rolling 24-hour basis to keep talks going without a nationwide strike.
In Britain, Prime Minister Gordon Brown on Sunday condemned nationwide wildcat strikes over the use of foreign workers, but unions warned more staff may down tools this week.
But fears of a deep global recession and a tumble in world energy consumption continue to unsettle investors.
A report from the US Energy Information Administration on Friday showed US oil demand in November was 305,000 barrels per day less than previously estimated and was down 1.577 million bpd from a year earlier.
Data also showed US gross domestic product fell at a 3.8 per cent annual rate in the fourth quarter, the biggest drop since the first three months of 1982.
Bleak economic data from South Korea, which showed its January exports shrinking by a record pace, also raised fears of a prolonged economic recession.
Reuters