* U.S. dollar rises, global stock markets weaken
* U.S. auto task force rejects GM, Chrysler turnaround plans
* Japan Feb industrial output falls 9.4 pct mth/mth
(Updates throughout, previous PERTH)
By Joe Brock
LONDON, March 30 (Reuters) - Oil fell below $51 a barrel on
Monday, extending the previous the sessions' losses, pressured
by a stronger U.S. dollar and a slump on global stock markets.
The U.S. government's rejection of turnaround plans for
troubled automakers GM <GM.N> and Chrysler also dampened
investors' sentiments and encouraged further sell off.
U.S. oil for May delivery <CLc1> fell $1.75 to $50.63 a
barrel by 0750 GMT. The contract fell $1.96 to settle at $52.38
a barrel on Friday, pulling back from Thursday's four-month
high.
London Brent crude <LCOc1> fell $1.57 to $50.41.
"The rejection of the turnaround plans has led to a pick-up
in risk aversion, which explains why oil is falling further,"
said Michelle Kwek, an analyst at Informa Global Markets in
Singapore.
European stock markets followed Asian shares lower on
Monday, while U.S. stock futures pointed downwards after Obama
administration's autos task force rejected turnaround plans for
GM and Chrysler, raising the prospect of bankruptcies that could
further undermine the already ailing U.S. economy. []
This renewed spirit of risk aversion strengthened the U.S.
dollar, which rose against other major currencies on Monday,
adding downward pressure on oil prices. []
Oil was up about 14 percent since the start of the month and
is looking for its biggest monthly gains since October 2007,
thanks to rallying stock markets and tightening oil supplies as
the Organization of the Petroleum Exporting Countries (OPEC)
curbs exports.
However, the global economy remains bogged down, leaving
analysts sceptical over the longevity of oil's rally.
Industrial output from Japan, the world's No. 3 energy
consumer, fell by a greater-than-expected 9.4 percent in
February, as weak demand weighed on an economy mired in its
worst recession since World War Two, but factories forecast a
small rise in production in coming months. []
"The overall demand outlook, at least in the short term,
continues to look quite bleak. The rally seen in the last two
weeks might perhaps have ran its course," said Toby Hassall,
head of research at Commodities Warrants Australia.
Also casting a pall over oil prices were comments on Sunday
from the Organisation for Economic Cooperation and Development
(OECD) that unemployment was set to reach double digits in many
developing and advanced countries. []
Still, analysts said hopes that the U.S. economy had finally
turned a corner were offering some underlying support for oil,
keeping prices above the psychologically important $50-level.
President Barack Obama said in an interview published on
Sunday that he saw "glimmers of stabilization" in some areas of
the U.S. economy, including pockets of the domestic housing
market. []
Leaders of the Group of 20 developed and developing nations
meet on April 2, hoping to restore global growth by the end of
2010, the Financial Times reported on Sunday, quoting a draft
communique for a summit this week. []
(Additional reporting by Fayen Wong in Perth; Editing by Keiron
Henderson)
