* Brent crude stays above $98/bbl for the 4th session
* NYMEX-Brent spread narrows after hitting 23-mth high
* Strong equities, weak dollar support market
(Updates prices, adds Asian shares)
By Seng Li Peng
SINGAPORE, Jan 17 (Reuters) - NYMEX crude fell below $91.20
a barrel but Brent crude held above $98 a barrel for the fourth
session on Monday, supported by a brighter economic outlook and
a weak dollar.
U.S. crude for February delivery fell 41 cents
to $91.13 by 0756 GMT, while Brent March values fell 14 cents to
$98.24 a barrel.
The spread between the two narrowed to less than $7.50
after hitting more than $8.00 a barrel on Friday, making that
the highest in 23 months.
"The U.S. is having a holiday today, and the crude and
equities markets are not expected to move dramatically," said
Ken Hasegawa, a commodity derivatives manager at Japan's Newedge
brokerage.
"The upper side of WTI will be $92.50 a barrel, with the
lower side at $90.00 a barrel."
The uptrend in the equities market has supported the crude
market, he added.
The S&P 500 ended a seventh straight week of gains last
Friday with a bank-led rally amid healthy volume after
encouraging financial results from JPMorgan.
The strength in financial stocks is combating the soft
December retail sales and consumer sentiment dented by rising
gasoline prices. [].
But Asian shares mostly fell on Monday, led by a drop
in Shanghai led by drop in Shanghai in the wake of China's
latest attempt to contain inflation.
The benchmark Shanghai Composite Index fell to
2,704.5 points by 0640 GMT, dropping far below the crucial
125-day moving average at 2,779. The index lost 1.7 percent last
week amid lingering fears over monetary tightening steps. []
But overall, the global financial markets are
maintaining their calm despite some instability in Europe over
the region's sovereign risks, said Bank of Japan Governor
Masaaki Shirakawa.
The global economy has experienced a slowdown but
continues to improve, with solid growth in emerging nations
likely to help Japan's economy resume a moderate pickup, he
said.
The dollar index versus a basket of currencies remained
dangerously near its December low.
The index stood at 79.40 at 0754 GMT, not far
above its Dec. 31 low of 78.775, a break through which could fan
expectations for more dollar weakness.
A weaker greenback supports dollar-denominated commodities
such as oil, making them cheaper for holders of other
currencies.
OPEC UNLIKELY TO INTERVENE
Iran's oil minister Massoud Mirkazemi said over the weekend
that $100 a barrel for oil was a 'real' price, and no OPEC
countries had requested any emergency meeting to discuss the
rising price of crude.
Separately, Secretary General Abdullah al-Badri told an
Austrian newspaper that while OPEC was ready to act to address
supply shortages in the oil market, it would not intervene if
prices were driven by speculation. .
At this stage, higher output will not stem the rise in crude
oil prices, as the climb is driven by increasing demand in
emerging countries, chief executive of French oil major Total
Christophe de Margerie told Reuters ahead of an energy
conference in the UAE capital Abu Dhabi on Sunday.
Although China's total apparent oil demand is expected to be
lower than in 2010, growth is still on the increase at 6.2
percent this year to around 9.66 million barrels per day (bpd)
versus 11.4 percent last year, based on a forecast from CNPC's
research arm. []
China will add an estimated 24.5 million tonnes, or 490,000
bpd of refining capacity versus last year's addition of 640,000
bpd, company officials told Reuters, citing a company research
report.
But de Margerie added that oil prices had risen too high too
quickly and this would not be well received by consumers.
This sentiment was shared by Hasegawa.
"Brent is still trying to test the $100 a barrel level, but
no one wants to buy crude at that level. It's too expensive from
a fundamental view."
"Most are waiting for some factors to bring the market down
to $85.00 a barrel."
Speculators increased their net long crude oil
futures positions in the week through Jan. 11, the Commodity.
Futures Trading Commission (CFTC) said on Friday.
Money managers, the group containing hedge funds and other
speculative investors, raised their net long positions to
195,655 from 175,862 positions in the previous week.
Tim Evans at Citi Futures Perspective warned that levels
were still elevated, describing the market as "overbought",
especially with prices above $90 a barrel.
In Alaska, the operator of the Trans Alaska Pipeline System,
which has been struggling for the past week with a leak in
piping at the Prudhoe Bay intake station, said the oil artery
would resume normal operations late on Sunday or early Monday.
(Reporting by Seng Li Peng; Editing by Clarence Fernandez)
