* Global efforts to stabilize banks calm markets
* Saudi cuts November oil shipments to Europe
* Goldman Sachs slashes oil forecast
(Updates prices, stock market action, Iraq comment)
By Matthew Robinson
NEW YORK, Oct 13 (Reuters) - Oil prices rose more than 4
percent on Monday as global markets rallied after governments
launched bailout schemes to shore up banks.
Britain, Germany, France, Italy and other European
governments all announced rescue packages to stave off the
global financial crisis, while U.S. Treasury Secretary Henry
Paulson said Washington was developing plans to buy equity in
financial institutions. []
U.S crude <CLc1> settled up $3.49 to $81.19 a barrel, after
concerns about the effect of the financial crisis on demand and
a flight of investors into safer havens sent prices to the
lowest level since Sept. 10, 2007, on Friday.
London Brent crude <LCOc1> rose $3.37 to settle at $77.46
barrel.
U.S. stocks surged on Monday, following their worst week
ever, with the Dow Jones industrial average <> and the
Standard & Poor's 500 Index <.SPX> up more than 6 percent in
afternoon activity.
"I think the bank bailout packages may have stabilized
financial markets and we're just following them higher," said
Tom Bentz of BNP Paribas Commodity Futures Inc.
"The dollar is weaker against the euro as well, and the
Saudis cut November oil shipments to Europe."
Investors rushed into oil and other commodities this year
as a hedge against the weak dollar and inflation, before
slowing fuel demand in the United States and other developed
economies knocked crude from record highs above $147 set in
July.
The drop in crude prices has prompted some members of the
Organization of Petroleum Exporting Countries to call for a
reduction in production levels when the cartel holds an
emergency meeting on Nov. 18.
Iraq's Oil Minister Hussain al-Shahristani said on Monday
OPEC will consider cutting output if the world does not need
its oil. []
"There has been a reduction in demand and the current
production of OPEC is more than the market can absorb," he
said.
Top exporter Saudi Arabia -- OPEC's most influential member
-- cut November supplies to one major European refiner,
according to a trade source, but told major Asian refiners
shipments would not be changed. []
Goldman Sachs, a long-standing commodity bull, became a
near-term bear on Monday after conceding that global financial
turmoil would take a far bigger toll on demand and that oil
prices could hit $50 if the crisis deepened. []
"We have underestimated the depth and duration of the
global financial crisis and its implications on economic growth
and commodity demand," Goldman's commodity markets research
team said.
The bank cut its year-end U.S. crude oil target to $70 a
barrel, down from a previous forecast of $115 a barrel, and
slashed its average 2009 forecast by a third to $86 a barrel.
(Additional reporting by Jane Merriman in London and Fayen
Wong in Perth; Editing by Christian Wiessner)
