Nov. 14 (Bloomberg) -- Crude oil rose for a second day in New York, extending its rebound from a 21-month low as gains in stock markets spurred expectations demand for fuel will increase.

Asia's benchmark stock index gained for the first day in four as investors took advantage of cheap valuations. Oil also climbed on plans by OPEC members to meet in Cairo at the end of the month to discuss further production cuts.

``The crude oil market is taking its cue from the equity markets,'' said Anthony Nunan, assistant general manager for risk management at Mitsubishi Corp. in Tokyo. ``Equities are the bellweather barometer for the sentiment on the economy. If equities rebound so should crude, they've been moving in lockstep since September.''

Crude oil for December delivery rose as much as $1.72, or 3 percent, to $59.96 a barrel on the New York Mercantile Exchange. It was at $58.37 a barrel at 12:08 p.m. Singapore time. Prices have tumbled 60 percent from a record $147.27 on July 11.

Yesterday, futures gained $2.08, or 3.7 percent, to $58.24 a barrel. Oil is set to fall 4.2 percent this week, the second week of decline.

``The equity markets are influencing perceptions of the economic outlook,'' said David Moore, a commodity strategist with Commonwealth Bank of Australia in Sydney. ``OPEC is suggesting that they'll review oil markets and those two factors are accounting for the price movements.''

The MSCI Asia Pacific Index added 1.7 percent to 83.71 at 12:07 p.m. in Hong Kong. Japan's Nikkei 225 Stock Average gained 4.1 percent to 8,578.52 and stocks also advanced in Australia and South Korea.

U.S. stocks climbed, with the Dow Jones Industrial Average rising 552.59, or 6.7 percent, to 8,835.25, after tumbling as much as 317.24 points earlier yesterday. The Standard & Poor's 500 Index increased 58.99 points, or 6.9 percent, to 911.29.

U.S. Stockpiles

Cnooc Ltd., China's biggest offshore oil and gas explorer, gained as much as 7 percent to HK$6.15 in Hong Kong trading today. Woodside Petroleum Ltd., Australia's second-largest oil and gas producer, rose as much as 5.5 percent to A$38.92 in Sydney trading.

Oil traders made their biggest bet yet that the Organization of Petroleum Exporting Countries will fail to prevent crude prices from plunging below $30 a barrel.

Trades in crude-oil options contracts that would allow the holder to sell oil for February delivery at $30 a barrel reached 1,407 on the New York Mercantile Exchange yesterday, making the contract the day's second-most active, exchange data show.

U.S. crude-oil stockpiles rose 22,000 barrels to 311.9 million barrels last week, the Energy Department said yesterday. Inventories were forecast to climb 1 million barrels, according to the median of 13 responses in a Bloomberg News survey.

The Organization of Arab Petroleum Exporting Countries is scheduled to meet in Cairo on Nov. 29. Non-Arab members of the Organization of Petroleum Exporting Countries, such as Venezuela, Iran and Angola, will be invited to take part in talks about the oil market afterwards, OPEC President Chakib Khelil told Algerian radio yesterday.

OPEC Decision

OPEC decided at a meeting in Vienna last month to cut the production target for 11 of the group's members by 1.5 million barrels a day, from 28.8 million barrels a day.

``The production cut means that spare capacity will be increased,'' said Tetsu Emori, a fund manager with Astmax Ltd. in Tokyo. ``So this should be a bearish factor longer-term even if it is bullish for the very short-term.''

Brent crude oil for January settlement rose 56 cents, or 1 percent, to $56.80 a barrel on London's ICE Futures Europe exchange. It was at $56.27 a barrel at 11:41 a.m. Singapore time. The contract rose $1.72, or 3.2 percent, to $56.24 a barrel yesterday.

The December contract expired yesterday after falling 38 cents, or 0.7 percent, to $51.99 a barrel. It touched $50.60 a barrel yesterday, the lowest since May 31, 2005.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net.

Last Updated: November 13, 2008 23:13 EST