09 Sep 2008
Sep. 9 (Bloomberg) -- Crude oil fell in New York as the dollar rose against the euro and Saudi Arabia's oil minister said supplies are sufficient to meet demand. The U.S. currency strengthened to the highest since October 2007 as the government's takeover of Fannie Mae and Freddie Mac encouraged investors to move funds into the stock market.
The oil market is "well balanced'' and inventories are in a "healthy position,'' Saudi Arabian Oil Minister Ali Al-Naimi said when arriving in Vienna for today's OPEC meeting. "You're starting to see some money going into the securities market and coming out of commodities,'' said Tetsu Emori, a fund manager with Astmax Ltd. in Tokyo.
"The stronger dollar is pushing down commodity prices.'' Crude oil for October delivery fell as much as $1.36, or 1.3 percent, to $104.98 a barrel and traded at $105.18 at 12:45 p.m. Singapore time on the New York Mercantile Exchange. Oil has dropped 29 percent from the record $147.27 reached on July 11. "The Saudis, Kuwaitis and others aren't so inclined'' to cut output, said John Vautrain, senior vice president at consultants Purvin & Gertz Inc. in Singapore during an interview with Bloomberg Television.
"They are ready to defend a price of around $80 but the higher price they don't think is very healthy.''Yesterday, October crude futures settled at $106.34 a barrel, up 11 cents, after falling as much as $1.53, or 1.4 percent, as investors dumped commodities because of the higher dollar. The contract climbed as much as 3.5 percent on concern Hurricane Ike will delay the restoration of Gulf of Mexico output that was closed because of Hurricane Gustav.
