RTRS: Oil down 1 pct ahead of vote, recession feared
By Annika Breidthardt
SINGAPORE (Reuters) - Oil fell 1 percent on Tuesday after shedding nearly $4 the previous session on renewed fears of economic recession, with investors unwilling to place big bets before the U.S. presidential election.
Crude oil has plummeted from its record above $147 a barrel in July as the credit crisis hits the real economy and limits fuel use in the United States, the world's top oil consumer, and other key consumer nations.
U.S. light crude for December delivery fell 65 cents to $63.26 a barrel at 0446 GMT, having fallen almost $4 in the previous session after October saw the steepest monthly price decline for oil.
London Brent crude retreated 79 cents to $59.69 a barrel.
After almost two years of campaigning, Democrat Barack Obama and Republican John McCain took their final shots at each other and swept across battleground states on Monday to wrap up a U.S. presidential election, in which Obama was leading but McCain hoped to pull off a historic upset.
"Traders are only focusing on one event for the next 24 hours, and that is the election," said Jonathan Kornafel, Asia director of U.S. based options trader Hudson Capital Energy.
"Although once the results are in, the market should still head lower, no matter who wins. It's just that things appear to be put on hold for the next 24 hours," he added.
On Monday, a slew of weak economic data indicating blunted oil demand had sent oil tumbling, taking center stage over any signs that top oil producer Saudi Arabia had cut back crude output in line with last month's OPEC decision.
U.S. auto sales plunged 32 percent in October to lows unseen in a quarter-century in a collapse that hit every major automaker and offered little sign the industry had hit bottom.
And U.S. factory activity -- a barometer for future oil demand -- contracted sharply in October, falling to its lowest in 26 years as the financial crisis racked the world's largest economy.
The market has been waiting for signs Saudi Arabia has cut back crude production after OPEC agreed last month to trim output by 1.5 million barrels per day (bpd) to support tumbling prices.
Asian trade sources said Saudi Arabia had yet to inform its customers of any cuts in November oil supply.
U.S. crude oil supplies probably rose last week on higher imports, while refinery utilization gained slightly, according to a Reuters poll of analysts ahead of weekly U.S. inventory data. (Editing by Ramthan Hussain)
