Oil prices higher above $43

World oil prices were higher above $43 on Monday in quiet pre-Christmas trade but weakening demand continued to weigh on the market, dealers said.

New York's main futures contract, light sweet crude for February delivery, was up 84 cents at $43.20 a barrel.

Brent crude oil for February delivery rose 68 cents to $44.68 a barrel after rising 64 cents to settle at $44.00 on Friday in London.

Jonathan Kornafel, Asia director of Hudson Capital Energy, a trading firm, said he expected prices to run between $40 and 45 "for a week or two" before they fall again.

At the close of trading in New York on Friday, the contract for January delivery expired at $33.87 a barrel, down $2.35 after diving to an intraday low of $32.40, a level last seen in February 2004.

"Crude fell as concerns over a global economic slowdown weighed on sentiment," said Sucden analyst Nimit Khamar.

Oil stockpiles in Cushing, Oklahoma, where New York oil is stored, are at maximum capacity. Incapable of parking more oil there at the end of Friday's session, investors were forced to sell off, analysts said.

In response to the price falls, OPEC president Chakib Khelil said Friday the cartel would keep reducing output.

"We will continue this reduction until the price will stabilise," Khelil told reporters in London after the 13-member group approved the biggest production cut in its history.

The Organisation of the Petroleum Exporting Countries (OPEC), which produces about 40 percent of the world's crude, agreed Wednesday to cut output by 2.2 million barrels per day in a bid to shore up prices.

Despite the move, prices dived last week. Prices have fallen heavily in recent months because of concerns about weakening demand in a slowing global economy.