Oil falls below $76 on stronger dollar

OPEC wary about oversupply, fragile economy Reuters NEW YORK  OIL prices fell $1 to below $76 a barrel on Friday, pressured by a stronger dollar which outweighed reaction from better-than-expected US jobs data. US crude futures fell $1 to $75.46 at 1:31 p.m. Brent crude fell 82 cents to $77.52. The dollar soared against the yen and the euro, making dollar-denominated commodities like crude more expensive for holders of other currencies, helping pressure prices.      Investors have been looking to economic data for signs of global economic recovery and a potential rebound in energy demand. US stocks sharply pared gains as the rising U.S. dollar weighed on commodities and risk appetite ebbed. In earlier trading, crude rose to near $78 a barrel after the U.S. Labor Department reported that employers cut only 11,000 jobs last month, the fewest in nearly two years. The jobless rate edged down to 10 percent.      But US unemployment remains high and energy fundamentals in the world's largest energy consumer are weak, keeping analysts skeptical about crude's upside potential. "Unemployment at 10 percent isn't an improvement, no matter how many times you slice it. The early rally here is being tempered by considerations of the overhang in petroleum supplies," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut. "In any case, the oil market is looking at the dollar and its movement at this point could likely lead to a test of crude support at $75," McGillian added.      Olivier Jakob with Petromatrix said high oil inventory levels in the United States, especially at the delivery point of U.S. crude at Cushing, Oklahoma, have been putting more pressure on U.S. oil prices than on North Sea benchmark Brent crude. Oversupply and the fragile state of the global economy will be among the issues facing the Organization of the Petroleum Exporting Countries when it meets on Dec 22. Analysts expect no change in OPEC's output policy.      OPEC's Secretary-General Abdullah al-Badri told Reuters on Thursday the group should be cautious as it needs to balance signs of economic recovery and abundant supplies. He said oil inventories remained above their five-year average and there were 165 million barrels of crude and products floating at sea, equal to almost two days' global demand and more than some estimates.      In terms of prices, the current band of $70-$80 is satisfactory, Saudi Arabian Oil Minister Ali al-Naimi told reporters in Cairo. "Right now you see the price is okay between $70 and $80, it's close to the target we set, it's almost $75 — it's good," Naimi said, referring to the $75 level that he has said suited producers and consumers.