* API reports likely U.S. crude stock draw
* Official government figures to be released later on
* Analysts warn that hurdles remain for OPEC to reach output
By Henning Gloystein
SINGAPORE, Oct 5 Oil prices rose in early
trading on Wednesday after a report that U.S. fuel inventories
may have fallen for a fifth straight week, but contracts
remained near the $50 marker where many traders currently see
fair value for crude.
U.S. West Texas Intermediate (WTI) crude oil futures
were trading at $49.18 per barrel at 0014 GMT, up 49 cents, or 1
percent, from their last settlement.
Traders said the higher prices were largely a result of a
report by the American Petroleum Institute (API) late on Tuesday
showing that U.S. crude inventories likely fell for a fifth
straight week, declining by 7.6 million barrels.
The U.S. government's Energy Information Administration
(EIA) will report official stockpile numbers on Wednesday,
although analysts polled by Reuters expect the EIA to report a
stock build of 2.6 million barrels for the week ended Sept. 30.
In international oil markets, benchmark Brent crude futures
were trading at $51.29 per barrel, up 42 cents, or 0.8
Gary Ross, founder and executive chairman at the New
York-based consultancy PIRA, said that a planned deal by members
of the Organization of the Petroleum Exporting Countries (OPEC)
to cut output would likely lead to only a modest price increase.
ING bank also warned not to read too much into the planned
OPEC production cut before details were agreed.
"This is still only a plan, and no final agreement has been
made," the bank said, adding that even modest cuts face hurdles
given that Iran, Nigeria and Libya have campaigned for
exemptions, which would mean members such as Venezuela and Saudi
Arabia would have to stomach larger cuts.
The Dutch bank said that prices had been "consolidating
below the horizontal resistance around $53.20 per barrel during
the past 4 months," and that higher prices "are possible within
the coming weeks to next few months, although limited."
(Reporting by Henning Gloystein; Editing by Richard Pullin)