* Threat of storm in U.S. Gulf of Mexico eases
* Higher U.S. crude oil stocks seen
* Price support from global stock surge, weak dollar
By Felicia Loo
SINGAPORE, Nov 10 (Reuters) - Oil prices eased to below $79
a barrel on Tuesday, as tropical storm Ida that cut U.S. oil
and gas supplies was downgraded from a powerful hurricane and
U.S. crude oil stockpiles were forecast to rise slightly.
A surge in global equities that cemented hopes of an
economic recovery and a sharp fall in the U.S. dollar helped
temper oil's drop.
U.S crude for December delivery <CLc1> dropped 50 cents to
$78.92 a barrel by 0311 GMT, after settling up $2 on Monday.
London Brent crude <LCOc1> dipped 46 cents to $77.31.
Although oil prices have risen 77 percent so far this year,
they are still nearly 47 percent below their high of more than
$147 a barrel struck in July last year.
"People are more confident about a global recovery due to
positive economic news except for the (U.S.) unemployment
numbers which are a lagging indicator," said Tony Nunan, risk
management executive at Mitsubishi Corp in Tokyo.
Global stocks surged on Monday after the Group of 20
finance ministers pledged to keep economic stimulus programs in
place until a recovery was assured. []
In the U.S., the Dow Jones Industrial Average rose to a
13-month high as U.S. stocks jumped 2.0 percent or more and
helped dull the allure of government debt.
A bigger-than-expected increase in China's pump prices on
Monday suggested that Beijing saw little danger of the
inflationary worries that beset price rise decisions as little
as a year ago.
The 7-percent rise in China's retail gasoline and diesel
prices, or 480 yuan ($70.32) per tonne, is not seen curbing
Chinese oil demand, which is instead expected to grow and
support global oil markets. []
The U.S. dollar fell to a 15-month low against a basket of
major currencies, lifting gold prices to a new record and the
euro above $1.50, and further lending support to oil prices.
The weakness in the greenback was due to expectations for
the U.S. interest rates to stay near zero, that prompted
investors to use it as funding for carry trades in higher
yielding assets. []
Ida, the first real storm threat of the 2009 season, was
downgraded from a hurricane on Monday, but production remained
curtailed as producers waited for the storm to pass over the
Gulf.
Ida shut in 29.6 percent of oil production and 27.5 percent
of gas output from the Gulf of Mexico, the U.S. Minerals
Management Service said Monday. []
U.S. crude oil inventories last week look to have risen
slightly due to higher imports, according to analysts polled by
Reuters late on Monday. []
Industry group American Petroleum Institute (API) will
release weekly inventory data later on Tuesday, while a report
from the U.S. Energy Information Administration (EIA) will be
delayed from Wednesday to Thursday due to a holiday.
(Reporting by Felicia Loo; Editing by Clarence Fernandez)
