* WTI, Brent firm on economic growth expectations
* Decline in U.S. crude oil stocks support prices
(Updates prices)
By Naveen Thukral
SINGAPORE, Dec 30 (Reuters) - Oil gained ground on Wednesday
as a U.S. coronavirus fiscal aid package and a decline in crude
oil inventories lifted prices.
Brent crude futures rose 35 cents, or 0.7%, to
$51.44 a barrel by 0803 GMT and U.S. West Texas Intermediate
(WTI) crude added 30 cents, or 0.6%, to $48.30 a barrel.
"Oil prices have remained supported by a weaker U.S. dollar
overnight and have finally found a friend in the API inventory
report," said Stephen Innes, chief global market strategist at
Axi, a broker.
"This morning the American Petroleum Institute reported a
much larger draw versus consensus in crude oil inventories for
the week ending December 25."
The dollar slumped to multi-year lows against many
currencies as traders looked past a new delay in U.S. stimulus
cheques and maintained bets that additional financial aid was
still likely.
Asian shares hit a record high with investors betting on a
strong economic recovery next year, as there is little sign
policymakers wind back massive stimulus efforts aimed at staving
off coronavirus-fuelled downturns.
Oil prices could gain more strength as vaccination
programmes around the world begin next year, allowing countries
to relax restrictions on movement and business activity.
U.S. physical crude oil grades strengthened on Tuesday as
the API reported a decline in stockpiles, dealers said.
Crude oil stocks fell by 4.8 million barrels last week to
about 492.9 million barrels, exceeding analysts' expectations in
a Reuters poll for a draw of 2.6 million barrels, data from API
showed.
In the short-term, concerns over coronavirus lockdowns are
likely to cap gains.
A new variant of the virus in the United Kingdom has led to
the reimposition of movement restrictions, hitting near-term
demand and weighing on prices, while hospitalizations and
infections have surged in parts of Europe and Africa.
Fossil-fuel demand in coming years could remain softer even
after the pandemic as countries seek to limit emissions to slow
climate change. Major oil companies, such as BP Plc and
Total SE, published forecasts that include scenarios
where global oil demand may have peaked in 2019.
A Jan. 4 meeting of the Organization of the Petroleum
Exporting Countries (OPEC) and allies including Russia, a group
known as OPEC+, also looms over the market.
OPEC+ is tapering record oil output cuts made this year to
support the market. The group is set to boost output by 500,000
barrels per day (bpd) in January, and Russia supports another
increase of the same amount in February.
(Reporting by Naveen Thukral; Editing by Sam Holmes, Kim
Coghill and Louise Heavens)