Saudi Oil Minister Ali Al-Naimi said on Wednesday the steep fall in oil prices in recent months would help economic recovery and that producers wanted reasonable returns without hurting growth.

"The price of oil ...  has declined in recent months by more than 70 percent since reaching their highest level in July -- a drop that will play a major role in aiding economic recovery," he told the Petrotech conference in New Delhi.

Meanwhile, oil rose more than 3 percent to above $39 a barrel on Wednesday as Opec kept up talk of production cuts and a cold snap in the United States boosted heating oil demand.

Saudi Arabia said on Tuesday it was prepared to go even further than cuts it had made since December if the market warranted it, while Opec's secretary general said the cartel may reduce oil output again at its meeting in March.

But analysts said downside risks remained high. A US government report due later in the day is expected to show crude oil stocks rising for the third consecutive week, by more than 2 million barrels.

US light crude for February delivery rose $1.30 to $39.08 a barrel by 0834 GMT. London Brent crude gained 50 cents to $45.33. - TradeArabia News Service