UPDATE 9-Oil rises over 1% on hopes demand will rebound from coronavirus effect


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    * Oil prices post first weekly increase in six
    * Investors eye potential OPEC+ cuts to limit supply surplus
    * Oil glut, stronger rouble strengthen case for Russia to
    * U.S. drillers add oil rigs for second week in row -Baker

 (New throughout, updates prices, market activity and comments
to settlement, adds CFTC data)
    By Stephanie Kelly
    NEW YORK, Feb 14 (Reuters) - Oil prices rose over 1% on
Friday, posting their first weekly gain since early January as
investors bet the economic impact of the coronavirus would be
short-lived and hoped for further Chinese central bank stimulus
to tackle any slowdown.
    Brent crude  LCOc1  rose 98 cents, or 1.74%, to settle at
$57.32 a barrel. It rose 5.23% since last Friday, its first
weekly increase in six weeks. 
    U.S. West Texas Intermediate (WTI) futures  CLc1  gained 63
cents, or 1.23%, to settle at $52.05 a barrel. The weekly rise
was 3.44%. 
    "The massive liquidation process that drove prices sharply
lower last month has likely been completed and is being replaced
by accumulation as well as short-covering from speculators who
have recently entered the market," Jim Ritterbusch, president of
Ritterbusch and Associates, said in a note. 
    Brent has fallen around 15% year to date in part due to
worries the coronavirus outbreak would stunt the global economy.
More than 1,380 people have died from the virus in China.
    However, market sentiment improved as factories in China
started to reopen and the government eased monetary policy in
the world's second largest economy.
    The World Health Organization said the jump in China's
reported cases did not necessarily mean a wider epidemic but
reflected a decision to reclassify a backlog of suspected cases.
    "Our baseline thesis remains that oil demand destruction
remains largely a China story and has yet to spill over to
impact global demand," said Helima Croft, head of commodity
strategy at Citadel Magnus.
    The International Energy Agency (IEA) said the outbreak
should knock first-quarter oil demand down from a year earlier
for the first time since the financial crisis in 2009.
    In response to the demand slump, the Organization of the
Petroleum Exporting Countries and allied producers, known as
OPEC+, are considering deepening production cuts. 
    The Kremlin said it has not yet reached a decision on
further output curbs. But industry sources said a growing oil
glut in Russia and the promise of a flood of dollars from the
sale of a leading bank are strengthening the case.  urn:newsml:reuters.com:*:nL8N2AE2TH
    UBS investment bank said in a note that commodity demand
concerns were likely to linger and "the asset class should
display a fair bit of volatility in the coming weeks."
    "We assume China's economic activity as well as commodity
demand will recover" from the second quarter, it said.
    In the United States, energy firms increased oil rigs for a
second straight week, adding two and bringing the total to 678,
energy services firm Baker Hughes Co  BRK.N  said.
    Money managers cut their net long U.S. crude futures and
options positions in the week to Feb. 11 by 15,446 contracts to
147,071, the U.S. Commodity Futures Trading Commission (CFTC)
said.  urn:newsml:reuters.com:*:nAQN025LBW

OPEC crude supply    https://tmsnrt.rs/2Sp6c6Y
Chinese, World Oil Demand Growth, y-o-y    https://tmsnrt.rs/31N6jMY
 (Additional reporting by Bozorgmehr Sharafedin in London,
Roslan Khasawneh and Koustav Samanta in Singapore; Editing by
Marguerita Choy and David Gregorio)
 ((Stephanie.Kelly@thomsonreuters.com; 646-223-4471; Reuters
Messaging: stephanie.kelly.thomsonreuters.com@reuters.net))

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