Jan. 9 (Bloomberg) -- Crude oil fell to the lowest in 18 months as mild weather in the eastern U.S. curbed heating-fuel consumption.

Temperatures in New York will rise to 48 degrees Fahrenheit (9 Celsius) today, 10 degrees above normal, the National Weather Service said. The world may have its warmest year on record in 2007, the U.K.'s government weather forecaster said Jan. 4. OPEC will speed up a 500,000 barrel-a-day output cut by almost a month to stop the fall in oil prices, Qatar's oil minister said.

``Supplies are more than adequate and demand isn't as strong as forecast,'' said Frank Verrastro, director of the Center for Strategic and International Studies energy program in Washington. ``Prices surged last year on concern there would be major disruptions that never occurred.''

Crude oil for February delivery fell 45 cents, or 0.8 percent, to $55.64 a barrel on the New York Mercantile Exchange, the lowest close since June 15, 2005. Prices are down 8.9 percent this year and 12 percent from a year ago.

Futures touched $53.88, the lowest intraday price since June 13, 2005, prior to Hurricane Katrina, which destroyed oil platforms and refineries along the U.S. Gulf of Mexico coast. Prices rose from the day's lows after the Qatari announcement.

Shades of Amaranth

``It looks like a big fund got burned,'' said Peter Beutel, president of Cameron Hanover Inc., a New Canaan, Connecticut, energy consultant. ``This reminds me a lot of what happened with natural gas back in September.''

Natural-gas futures plunged 26 percent in September, touching a three-year low, as Amaranth Advisors LLC tried to get out of its wrong-way bets on the market. The hedge fund lost more than $6.5 billion, putting it out of business.

OPEC countries agreed to cut output by 1.2 million barrels a day starting Nov. 1, and a further cut was agreed to last month of 500,000 barrels a day from Feb. 1. The Organization of Petroleum Exporting Countries made the cuts because of falling prices, which are down 29 percent from the record of $78.40 a barrel reached on July 14.

``The OPEC president has spoken to members today, and I have instructed Qatar Petroleum to make the Abuja cuts immediately,'' Abdulla bin Hamad al-Attiyah said in an interview from Doha today.

OPEC output fell 245,000 barrels a day, or 0.8 percent, last month, according to a Bloomberg survey of oil companies, producers and analysts. Daily production declined 550,000 barrels in November.

OPEC Doubts

``There is growing doubt about OPEC following through with its production cuts,'' said Rick Mueller, an analyst with Energy Security Analysis Inc. in Wakefield, Massachusetts. ``The cuts aren't seen to be real.''

The increasing global demand for oil that became evident in late 2004 and in 2005 is now over, said Adam Sieminski, chief energy economist at Deutsche Bank AG in New York.

``Demand forecasts are fading,'' Sieminski said on a conference call with reporters today. ``It's forcing OPEC into a cutting mode for the first time in a while.''

Crude oil also surged during the first half of 2006 on concern that Iran's defiance of United Nations nuclear inspectors might disrupt the nation's exports and on disruptions of supply from Nigeria and Iraq. Prices retreated as a mild 2006 hurricane season left U.S. facilities unharmed and Middle East tensions eased.

`What's Not Happened'

``We are falling in large part because of what's not happened,'' Verrastro said. ``There has been no confrontation with Iran, there hasn't been a total shutdown of Iraqi production, Alaskan shipments resumed sooner than many expected and no hurricane hit the U.S. this past season.''

More than half of the 400,000 barrel-a-day Prudhoe Bay field in Alaska was idled in August after BP Plc found oil had leaked from corroded pipelines. Production was back to normal levels by mid-October.

Crude oil in New York has fallen 18 percent in the past year when measured in euros, 20 percent in British pounds and 8.7 percent in yen.

Home-heating demand in the Northeast, where four-fifths of U.S. heating oil is used, will be 24 percent below normal through Jan. 16, forecaster Weather Derivatives said today. Above-normal temperatures will cover the region from Jan. 14 through Jan. 18, the government said.

Ample Supplies

``It's hard to be worried about heating-oil supplies when we've seen 60-degree weather this January,'' Mueller said. ``Refiners are shifting to gasoline production, which should leave us with ample supplies. Demand for crude oil should fall as the product stockpiles grow.''

Inventories of distillate fuel, a category that includes heating oil and diesel, rose 2 million barrels last week from 135.6 million barrels the week before, according to the median of 13 responses in a Bloomberg News survey. Gasoline supplies probably climbed 2.5 million barrels from 209.5 million last week, according to the survey.

Brent crude oil for February settlement fell 42 cents, or 0.8 percent, to close at $55.18 a barrel on the London-based ICE Futures exchange. Futures touched $53.64 a barrel, the lowest intraday price since June 13, 2005.

To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

Last Updated: January 9, 2007 15:24 EST