Oil rebounds slightly, eyes US inventory data

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SYDNEY, Nov 14 (Reuters) Oil edged up on Wednesday, rebounding from two sessions of losses as prices backed away from record highs, on expectations data will show that U.S. oil inventories fell for a fourth-straight week.

Saudi Arabia's oil minister Ali al-Naimi has confirmed that OPEC will not discuss raising crude output at a heads-of-state meeting on Nov. 17-18, shifting the market focus back to the short-term outlook, which points to a supply shortfall during the northern hemisphere winter.

''The big focus now is the U.S. inventory report. Polls are showing a drawdown in crude stocks and some speculators may be seeing opportunities to buy again after yesterday's fall,'' said Tony Nunan, risk manager for Mitsubishi Corp in Tokyo.

U.S. light crude for December delivery rose 48 cents to .65 a barrel by 0740 GMT, after dropping more than 3.5 percent on Tuesday. London Brent crude gained 57 cents to .40 a barrel.

A Reuters poll shows that Thursday's U.S. inventory data is expected to show crude stocks dropped last week by an average of 800,000 barrels, which would be the fourth consecutive weekly decline. S] Analysts also expect 100,000 barrel draws in both distillate and gasoline stocks. Refinery runs were forecast to be up 0.5 percentage points.

The weekly report is being released a day later than usual because of the federal Veterans Day holiday on Monday.

The OPEC summit in Riyadh this weekend brings together heads of state of the OPEC nations for the first time since 2000, when oil was at a barrel.

But the oil cartel's next official policy meeting is on Dec. 5 in Abu Dhabi.

The producers agreed to increase output by 500,000 barrels per day (bpd) starting Nov. 1, although analysts have said the rise would not be enough to stem decreases in consumer stockpiles.

Oil has fallen about a barrel from last week's record of .62, as signs of a slowing U.S. economy, a pick up in the dollar and signs that OPEC may finally take action encouraged profit-taking.

The slide continued on Tuesday after the International Energy Agency (IEA), adviser to 26 industrial consumer nations, cut its predictions for demand growth by 570,000 bpd for the fourth quarter and by 180,000 bpd more for the first quarter.

While the cuts were steep, some analysts said the revision was from very high levels and overall global consumption of more than 85 million bpd in 2007 and 2008 was still robust.

''The agency's inability to anticipate warmer-than-usual weather as well as greater-than-anticipated interfuel substitution have also played a significant role in undermining its projections,'' JP Morgan said in a research note.

REUTERS SLD RAI1340

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