RTRS: UPDATE 4-Oil falls towards $82 as dollar's slide eases
* Stabilisation in U.S. dollar brakes oil's rise
* China raises bank reserve requirements
* Iran increases official reserves figure
* Coming Up: OPEC meeting October 14
(Updates comments, prices)
By David Turner
LONDON, Oct 11 (Reuters) - Oil prices fell on Monday on signs that the fillip to prices caused by expectations of further U.S. monetary easing (QE2) were running out of steam.
"The big factor in the oil market in the past couple of weeks has been the pricing in of QE2", said Mike Wittner, oil analyst at Societe Generale in London, who credited oil's sustained breakout above $80 at the end of last month to expectations of QE2.
"However, this pricing in may be coming to an end."
Expectations of QE2 have weakened the dollar, by increasing the prospect that U.S. inflation will rise. A fall in the greenback therefore boosts the dollar value of oil, which is usually traded in the U.S. currency. However, on Monday the dollar's recent downward fall almost paused. .DXY
Oil was, however, steady on the news, revealed by Reuters, that China, the world's largest energy user according to the International Energy Agency, had raised the required reserves of its four leading state banks to drain cash from the economy. [ID:nTOE69A03Y]
Reacting to the news, Amrita Sen, commodities analyst at Barclays Capital in London, said: "Given how energy intensive the Chinese economy is, even with some soft landing we do not expect this to change."
U.S. crude for November CLc1 was 51 cents down on the day at $82.15 a barrel at 1322 GMT. Prices touched a five-month intra-day high of $84.43 last week. ICE Brent LCOc1 fell 65 cents to $83.38.
The market will seek further clues to developments in the global economy from the release of the minutes for the last Fed meeting on Tuesday, China trade data on Wednesday, and U.S. retail sales for September on Friday.