"The trend at the moment is still south," said Justin Wilks, director of trading and operations for $300 million Australia-based fund manager Global Commodities.

"Any amount of production cuts will take a little time to come through, but like base metals it's all tied to economics at the moment," he added.

While Saudi Arabia had cut output more deeply ahead of OPEC's meeting two weeks ago, other major members have yet to show their hand. Sources with several Asian refiners said on Tuesday that they had not received any new notices as yet.

Prices got no lift from a WSI Corporate forecast that a relatively warm January will give way to colder-than-usual late-winter weather in the US Northeast that could boost demand for heating fuels.

Surging demand from China and other emerging nations sent crude on a six-year rally to record highs over $147 a barrel stuck in July, before the economic crisis began to slow demand in top consumer the United States and big economies.

Now, however, even the leaders appear to be showing the toll of the global financial crisis and its impact on the economy.

Apparent oil consumption in China fell by 3.2 per cent in November from a year ago, the first decline in nearly three years, Reuters calculations confirmed this week, while crude imports into the world's No. 2 energy consumer dropped to the lowest level this year.

Later on Tuesday traders will be looking for confirmation the US economy contracted by 0.5 per cent in the third quarter, in line with preliminary data.

... contd.