By Jack Stubbs
LONDON (Reuters) - Brent crude oil crept above $49 a barrel on Thursday ahead of an expected decision by the European Central Bank (ECB) to start buying bonds, a move which could push the dollar to new highs and put downward pressure on commodities.
The ECB's Executive Board has proposed a programme that would allow it to buy 50 billion euros ($58 billion) of bonds a month starting in March, a euro zone source said. The expected stimulus programme has pressured the euro and sent the dollar, seen as a safe haven, soaring.
A strong dollar, buoyed by an expected U.S. interest rate hike and an American economy that is growing while Europe and Asia slow, dents demand for dollar-priced commodities by making them expensive for holders of other currencies.
Oil prices have already more than halved since June last year due to oversupply and a fall in global demand.
Brent crude futures traded at $49.53 a barrel by 1045 GMT, up 50 cents. U.S. crude was up 15 cents at $47.93.
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CMC Markets analyst Michael Hewson said the expected ECB so-called "quantitative easing" policy, printing money to buy sovereign bonds, was unlikely to affect oil prices in the long term.
"I find it difficult to think that anything the ECB announces today is really going to alter the supply-demand dynamics with respect to oil prices," he said.
"We may get some intra-day volatility, but will it change the overall direction of the oil price? I doubt it."
Oil prices have steadied near $50 a barrel in January and analysts say the long-term outlook is improving. In a formation known as a "contango", the price of oil to be delivered immediately is trading well below barrels for supply in the future.
"The Brent contango has been narrowing," said Olivier Jakob, oil analyst at Petromatrix in Zug, Switzerland. "The structure has been improving while the flat price has been bottoming."
"The market right now is consolidating before trying to determine which will be the next directional trend."
Brent crude prices for delivery this March are $10 a barrel cheaper than those for March 2016, making it attractive to buy oil now and put it into storage for sale later, traders say.
Analysts expect U.S. crude stocks to have increased by roughly 2.6 million barrels in the last week, further depressing oil prices. Data from the U.S. Department of Energy's Energy Information Administration (EIA) will be released at 1600 GMT Thursday. EIA/S ($1 = 0.8620 euros)
(Additional reporting by Henning Gloystein in Singapore,; Editing by Christopher Johnson)