Oil edge up in volatile trade on U.S. crude build, Russian OPEC support

By Scott DiSavino

NEW YORK (Reuters) - Oil prices edged higher in volatile trading as the market weighed Russia's comments about a possible meeting with Saudi Arabia on possible output cuts against a bigger-than-expected U.S. crude storage build.

Brent futures were up 28 cents, or 0.6 percent, at $47.23 a barrel by 11:00 a.m. EST (1600 GMT). U.S. crude rose 32 cents, or 0.7 percent, to $46.13 per barrel.

Before the U.S. Energy Information Administration released its petroleum status report, both contracts were down less than 1 percent. That followed a surge of almost 6 percent on Tuesday on news the Organization of the Petroleum Exporting Countries would renew efforts to limit production.

EIA said crude stocks increased by a bigger-than-expected 5.3 million barrels, topping analysts' 1.5 million-barrel build in a Reuters poll.

Russia, meanwhile, said it was ready to support OPEC's decision on an oil output freeze and sees big chances that the oil producers' group can agree on the terms of the freeze by Nov. 30, Russian Energy Minister Alexander Novak said on Wednesday.

The U.S. crude build dampened Tuesday's rally on news that OPEC members were meeting ahead of an official group gathering on Nov. 30 to build consensus for a deal to limit output.

Venezuelan President Nicolas Maduro said he will meet with OPEC secretary-general Mohammed Barkindo in Caracas on Wednesday to discuss the freeze.

A number of energy ministers from OPEC countries are also likely to meet informally in Doha on Friday to try to build consensus over decisions taken by the full group in September in Algiers, an Algerian energy source said.

Those informal meetings could include energy ministers from Saudi Arabia and Russia. But Iran's oil minister will not be attending, sending the country's OPEC governor instead, sources said.

"Key in this regard will be talks between the Saudis and Russia...We see enough cooperation between these two oil power houses to keep a significant amount of OPEC premium embedded in the market," Jim Ritterbusch, president of Chicago-based energy advisory Ritterbusch & Associates, said in a note.

Dutch bank ABN Amro, meanwhile, lowered its oil price forecasts on Wednesday, expecting Brent and U.S. crude to average $50 a barrel in the fourth quarter.

"We estimate the possibility of an actual OPEC production cut as 50-50," said Hans van Cleef, senior energy economist at ABN Amro.

(Additional reporting by Karolin Schaps in London and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy and Louise Heavens)