Oil lifted after Libya's largest field shuts

NEW YORK (Reuters) - Crude oil futures rose on Tuesday on news that production had stopped at Libya's largest oilfield.

The Sarir and the nearby Messla oilfields in Libya were shut because of a power cut, dealing another blow to exports from the embattled OPEC member nation.

Also lending support to crude was news that Greece's euro zone partners had approved the government's reform plans, thereby securing an extension of their financial rescue operation.

Brent April crude was up 52 cents at $59.42 a barrel at 12:24 p.m. EST. U.S. April crude was up 58 cents at $50.03.

While lower Libyan output and economic stability in Europe helped support the market, rising oil inventories in the United States still highlighted a heavily over-supplied market, analysts and brokers said.

Traders awaited U.S. oil inventory data due later on Tuesday from industry group American Petroleum Institute, and from the government on Wednesday, to see if crude stocks posted another increase last week.

"The fundamental backdrop is still bearish," said Carsten Fritsch, senior oil and commodities analyst at Commerzbank in Frankfurt, adding there was a "huge over-supply in the market."

A Reuters survey on Monday estimated U.S. crude stocks, already at record levels, had risen by 4 million barrels last week.

"We expect another strong increase in U.S. crude inventories to be reported," Fritsch said.

Higher prices for crude further out on the calendar have created an incentive to store crude at the Cushing, Oklahoma, delivery point for the U.S. futures contract, according to analysts and brokers.

Ahead of Friday's March contract expirations, a squeeze on benchmark U.S. ultra-low sulfur diesel (ULSD) futures eased on Tuesday.

March ULSD fell more than 10 cents, sharply reducing its premium to April ULSD.

Scheduled refinery work [REF/US] and the possibility that a strike by U.S. refinery workers may begin to limit production has helped lift Brent's premium to U.S. crude.

The Brent-U.S. crude spread stood at $9.43 a barrel, widening to $10.19 intraday. It reached $10.27 on Monday, widest since March 2014.

Crude oil prices were lifted briefly on Monday by a Financial Times report quoting Nigeria's oil minister as saying the country would call an extraordinary OPEC meeting if prices dropped further.

But delegates to the Organization of the Petroleum Exporting Countries told Reuters on Tuesday that the group had no plans to meet before June.

(Additional reporting by Alexis Akwagyiram in London and Jane Xie in Singapore; Editing by Christopher Johnson, Dale Hudson and Peter Galloway)