Oil pared a decline from near the lowest level in almost seven weeks in New York amid speculation that the European Central Bank may alleviate the region’s sovereign debt crisis, boosting growth and fuel demand. Futures advanced as much as 1.3 percent after a euro-region central bank official, who declined to be identified, said policy makers are likely to debate the resumption of covered- bond purchases next week. Earlier, oil plummeted to the lowest level since Aug. 9 on concern the European crisis could trigger another recession as Greece teeters on the brink of default. “There’s some talk that the European policy makers are putting together some new measures to ease the region’s debt crisis and that’s making the markets a little more stable,” said Tom Bentz, a broker with BNP Paribas Commodity Futures Inc. in New York. “The markets are still worried about the whole economic picture and a Greek default.” Crude for November delivery slipped 47 cents, or 0.6 percent, to $79.38 a barrel at 9:20 a.m. on the New York Mercantile Exchange. It touched $77.11 and $80.85 a barrel in intraday trading. Oil has fallen 13 percent this year. Brent futures for November settlement fell 20 cents, or 0.2 percent, to $103.77 a barrel on the London-based ICE Futures Europe exchange. The reintroduction of 12-month loans to banks will be discussed at the ECB’s Oct. 6 policy meeting, according to the central bank official, who spoke on condition of anonymity because the information is confidential. Interest-rate cuts are likely to be discussed, though they are not on the current agenda, the official said. Weakened Demand The European financial crisis and general fears about the global economy have weakened demand for crude, Qatari Oil Minister Mohammed Saleh al Sada said yesterday in Doha. Supplies are adequate and the nation is pleased that Libya is starting to produce and export oil, he said. “The market is biding its time before some news comes that will get it moving again,” said Peter Beutel, president of trading advisory company Cameron Hanover Inc. in New Canaan, Connecticut. “There’s a little optimism in Europe, optimism that they are getting a new Greek package together. It’s not enough to get this market to move around strongly.” Saudi Arabia, the world’s largest crude exporter, may cut production to prevent prices falling below $90 a barrel in London, according to HSBC Holdings Plc. “If the world economy manages to generate some growth, albeit it at a slower pace, we would expect oil prices to remain well supported above $90 to $100” for Brent crude, said Amrita Sen, a commodities analyst at Barclays Plc in London. To contact the reporter on this story: Margot Habiby in Dallas at mhabiby@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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