NYMEX-U.S. crude falls towards $86 on strong dollar

                                
 SINGAPORE, May 4 (Reuters) - Oil prices fell near $86 a
barrel on Tuesday on dollar strength, after hitting a 19-month
high above $87 on Monday on economic optimism and a possible
short-term supply crunch related to a massive oil spill off the
U.S. Gulf Coast.
                                
 FUNDAMENTALS
                                
 * NYMEX crude for June delivery fell 19 cents to $86.00 a
barrel by 0107 GMT. The contract rose 4 cents to settle at
$86.19 a barrel on Monday.
                                
 That was below the intraday high of $87.15, which just
eclipsed the previous 2010 peak of $87.09 struck on April 6 and
was the highest front-month crude price since $89.82 traded on
Oct. 9, 2008.
                                
 * U.S. crude inventories likely rose last week as the
widening contango structure of the futures curve encouraged
refiners to import more supply for storage, a preliminary
Reuters poll ahead of inventory reports showed on Monday.
[EIA/S]
                                
 * U.S. manufacturing registered its fastest pace of growth
in nearly six years in April while data on construction and
consumer spending pointed to further strength in the economy.
[ID:nN03207244]
                                
 For a technical view on crude prices, see: [ID:nSGE64300R]
                                
 For a technical chart on crude prices, click:
  http://graphics.thomsonreuters.com/gfx/WT_20100405084512.jpg
                                
 MARKETS NEWS
                                
 * The euro huddled near one-year lows on Tuesday as
concerns grew on whether a rescue package for debt-stricken
Greece will work, while the Australian dollar held firm ahead
of an expected rise in domestic interest rates.
                                
 The U.S. dollar hovered near eight-and-a-half month highs
against the yen, boosted by robust data that backed views that
the Federal Reserve will be ahead of its counterparts in Europe
and Japan in raising interest rates later this year. [FRX/]
                                
 * U.S. stocks staged a broad rally that drove the S&P 500
to its best day in two months on Monday after manufacturing,
consumer spending and construction data instilled confidence
that the economic recovery is gaining traction. [.N]
                                
 * Gold futures trekked up to a firm finish on Monday, on
continued safe-haven buying that pushed it to a 2010 peak
earlier, while U.S. crude oil also ended firm but below the
day's 19-month high. [COM/WRAP]
                                
 DATA/EVENTS
                                
 * The following data is expected on Tuesday:
                                
 - U.S. API weekly crude stocks        (20:30 GMT)
                                
 - U.S. API weekly dist stocks         (20:30 GMT)
                                
 - U.S. API weekly gasoline stocks     (20:30 GMT)
                                
 - U.S. ICSC/GS weekly report          (11:45 GMT)
                                
 - U.S. Redbook weekly                 (12:55 GMT)
                                
 - U.S. Factory orders March           (14:00 GMT)
                                
 - U.S. Durable goods March-Rev        (14:00 GMT)
                                
 - U.S. Pending home sales March       (14:00 GMT)
                                
 - U.S. Treasury secretary Timothy
                                
   Geithner testifies to Congress      (14:00 GMT)
                                
 RELATED NEWS > Oil ends higher on economic data, spill
[ID:nN03107955] > US crude stockpiles rise as imports up again
[ID:nN03223889] > Colombia certifies 3.1 bln oil barrels
[ID:nN03227295] > US Gulf tanker rates surge on oil spill risks
[ID:nN03227838] > No damage reported after strong Chile quake
[ID:nN03237415]
 (Reporting by Judy Hua; Editing by Ed Lane)