Oil prices held firm on Monday, holding gains from a strong rally the session before as traders fretted over cold weather in the U.S. and the prospect of tighter OPEC supplies in the second quarter. IPE Brent crude futures fetched $30.60 by 1114 GMT, up 13 cents from the end of the previous session, which had seen a $1.13 gain. U.S. markets were closed on Monday for the Martin Luther King Day public holiday. Weather forecasters predicted a continuation of the cold spell in the United States that has driven down energy stockpiles and helped lift prices to fresh nine-month highs. Speculative profit taking has knocked London futures off those peaks in the last week, but indications that the OPEC cartel could tighten supply further at its next meeting in February looked to provide fresh support. Kuwaiti Energy Minister Sheikh Ahmad al-Fahd al-Sabah said on Saturday OPEC may have to cut its output to offset a big surplus expected to overhang global oil markets in the second quarter. "There will be a big surplus in the second quarter on the markets which will result in a big drop in prices, therefore we should work to cut production," the minister told reporters.
"But we must be sure of this information through observation and consultations with the rest of the (OPEC) countries at the upcoming meeting in February." The International Energy Agency has projected a huge second quarter build in oil inventories, strengthening the case for OPEC to cut at its next meeting, on February 10 in Algiers. Helped by OPEC's last cut, by the cold weather in the U.S. and by booming Asian demand, oil has gained $5, or nearly 20 percent, since the cartel announced its September supply tightening. U.S. commercial crude stocks, already at their lowest since late 1975, looked under continued pressure from the weather. Private forecaster Meteorlogix predicted temperatures in the Northeast would stay below normal until at least Friday. "This weather pattern is a cold one for the East, especially the Great Lakes and Northeast, but the severity of the cold is not expected to be as great as the previous couple of outbreaks. Nevertheless, the cold will be fairly persistent," Meteorlogix said. Leading the boom in Asian demand is China, which released data on Monday showing its crude oil imports rose nearly 80 percent year on year to 9.3 million tonnes in December, fuelled by a flourishing economy, huge infrastructure projects, a bustling transport sector, a family car boom and a power supply crunch. The massive rise, the second highest in 2003 after September's 9.8 million tonnes, pushed China's crude imports to record levels and set the country on course to become second only to the United States in the league of world oil consumers.//