By Christian Schmollinger and Gavin Evans Nov. 10 (Bloomberg) -- Crude oil rose more than 5 percent and copper, zinc and lead surged after China announced a 4 trillion-yuan ($586 billion) stimulus package that may spur economic growth and demand for raw materials. China, the world's second-largest oil consumer, yesterday said it will spend the money through 2010 on housing and infrastructure, boosting demand for commodities including iron ore, crude oil and copper, which also gained. Saudi Aramco, the world's biggest state oil company, told South Korean and Japanese refiners it would cut December supplies. ``China's steps will stimulate investment and also spending by consumers, all of which drives oil demand,'' said Victor Shum, a senior principal at consultants Purvin & Gertz Inc. in Singapore. ``The oil market has been waiting for a clear signal out of the Saudis that they'd cut and this is an indication that they are following through.'' Crude oil for December delivery gained as much as $3.26, or 5.3 percent, to $64.30 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $63.65 at 12:30 p.m. in Singapore. Prices fell 10 percent last week as equities dropped, U.S. fuel stockpiles rose more than expected and the nation's unemployment rate climbed to a 14-year high. ``The stimulus package was exactly what the market was looking for,'' said Sean Mulhearn, head of commodity derivative product sales at Standard Chartered Plc in Singapore, in an interview with Bloomberg Television. ``We've seen crude oil rally and the metals market, particularly base metals and copper, have a very strong rally. The market got a good piece of information and reacted very positively.'' Commodities Surge Copper for delivery in three months on the London Metal Exchange climbed for the first day in four to $4,040.00 a metric ton, and stood at $4,039 a ton at 10:17 a.m. Singapore time. Bullion for immediate delivery rose for the second day, gaining as much as 2.2% to $752.99 an ounce and trading at $748.81 an ounce at 12:37 p.m. in Singapore. Corn for December delivery rose as much as 14.5 cents, or 3.9 percent, to $3.90 a bushel in electronic trading in Chicago and stood at $3.82 by 10:56 a.m. Singapore time. Soybeans for January delivery added as much as 33.25 cents, or 3.6 percent, to $9.5425 a bushel and traded at $9.4325. China said yesterday it will spend the equivalent of almost a fifth of its gross domestic product last year on infrastructure and encourage investments in machinery. The International Monetary Fund is forecasting that the economies of the U.S., Japan, Europe and the U.K. will all contract next year in their first simultaneous recession since the Second World War. Saudi Cuts Governments worldwide must do all they can to lower interest rates and raise spending to support sustainable economic growth, finance ministers and central bankers from the Group of 20 industrial nations said in a statement after a meeting in Sao Paulo yesterday. ``This is all supportive for oil,'' said Purvin & Gertz's Shum. ``The major economies and central banks will continue to take steps to get the financial markets going again.'' Saudi Aramco, the world's biggest state oil company, will cut crude supplies in December to customers in Japan by about 5 percent to 6 percent below levels agreed under annual contracts, a refinery official said. The Dhahran, Saudi Arabia-based producer will reduce mostly supplies of its heavy crude, said the refinery official who had received notices from the company and asked not to be identified because of confidentiality agreements. Brent Jumps Brent crude oil for December settlement gained as much as $3.11, or 5.4 percent, to $60.46 a barrel on London's ICE Futures Europe exchange. The contract was at $59.79 at 12:18 p.m. Singapore time. Shipments from Russia, the biggest producer after Saudi Arabia, have fallen 25 percent below normal levels this month after export duties fell less than oil companies had wanted, Interfax reported Nov. 9. Producers have contracts to meet and the reduction in deliveries will be temporary, the news service said, citing Nikolai Tokarev, chief executive officer of government-owned pipeline operator OAO Transneft. To contact the reporters on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net; Gavin Evans in Wellington at gavinevans@bloomberg.net

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