* Credit crisis still feared hitting demand
* Iraq says OPEC members worried by oil price fall
By Annika Breidthardt
SINGAPORE, Oct 7 (Reuters) - Oil rebounded above $88 a
barrel on Tuesday, recouping some of the $6 losses that sent it
to an eight-month low the previous day when investors bet the
global economy would slip into recession and demand for fuels
would sink.
Governments around the world scrambled for new measures to
contain the fast-spreading credit crisis amid a cross-asset
sell-off in stocks, bonds and commodity markets. []
U.S. light crude for November delivery <CLc1> was 75 cents
higher at $88.56 a barrel at 0111 GMT, the first rise in five
trading days.
That came after it fell as low as $87.56 a barrel on
Monday, the first time below $90 since early February.
London Brent crude <LCOc1> rose 46 cents to $84.14 a
barrel.
"It's a dead-cat bounce on thin volumes as traders digest
yesterday's rout," said Jonathan Kornafel, director Asia of
Hudson Capital Energy.
A crisis that began with the overheated U.S. property
market and the $11 trillion U.S. mortgage market was still
rocking confidence worldwide, with Sweden, Austria and Denmark
following Germany's lead by offering blanket deposit guarantees
to depositors.
Iceland meanwhile gave regulators sweeping powers to
oversee a faltering banking system as its currency fell 30
percent. [].
In the United States, more steps to shore up banks and ease
pressure on the credit markets could be coming, following the
$700 billion bailout bill last week. []
The U.S. dollar's rise to a fresh 13-month peak against the
euro on Monday also pressured commodities, including oil.
Oil prices have tumbled from a peak above $147 a barrel in
July as high fuel prices and the fallout from the financial
crisis slow oil demand in top consumer the United States and
other industrialised countries.
Oil demand in China, which helped fuel a 6-year rally in
commodities, will be key. Analysts are watching for signs the
crisis is hitting consumption there.
China will skip gasoline imports in October for a second
successive month due to heavy domestic stockpiles and a dip in
demand, traders said. []
And members of producer group OPEC worried about the drop
in the price of oil to around $90 a barrel, Iraq's oil minister
told Reuters in an interview. []
UBS cut its forecast for 2009 U.S. oil prices by $15 to
$105 a barrel due to weaker fundamentals and financial
outflows, making it the latest in a slew of banks to have
trimmed its expectations. []
"We still expect prices to rise this winter, but from a
lower level to a lower high. What's more, macro risks are
growing, seemingly by the day," UBS economist Jan Stuart said
in a note.
News that Mexico's state-owned oil company Pemex was
evacuating four offshore oil platforms due to tropical storm
Marco could become supportive for prices. []
(Reporting by Annika Breidthardt; Editing by Michael
Urquhart)
