* Firmer dollar piles pressure on oil prices
* Analysts see upside risk from Iran's election row
* G8 wants measures to curb oil price volatility
By Chua Baizhen
SINGAPORE, June 15 (Reuters) - Oil fell below $72 on
Monday, retreating further from eight-month highs as the dollar
rose, although traders kept a close watch on Iran where
contested election results sparked a weekend of violent
protests.
The dollar rose broadly on Monday, cutting into the
commodity purchasing power of buyers using other currencies, as
investors took profits on non-dollar currencies that had
climbed to multi-month highs. []
U.S. crude <CLc1> fell 44 cents to $71.60 a barrel at 0247
GMT, and London Brent crude <LCOc1> dipped 39 cents to $70.53.
"I would say the dollar is probably the driver... but I
have to say I am surprised that (the Iran situation) didn't
drive the market up," said Clarence Chu, a trader at U.S.-based
Hudson Capital Energy in Singapore.
Supporters of Iran's defeated presidential candidate plan a
rally in Tehran on Monday to protest against the re-election of
Mahmoud Ahmadinejad, which has sparked two days of violent
protests in the capital. []
Former Prime Minister Mirhossein Mousavi has appealed to
the Islamic Republic's top legislative body to annul Friday's
election result, in which hardliner Ahmadinejad took 63 percent
of the vote.
"The Iranian situation would be bullish. It's another round
of geopolitical risk to consider, if it leads to instability in
Iran," said Tony Nunan, risk manager at Mitsubishi Corp in
Tokyo.
Iran is the world's fifth-largest oil producer and its
coastline flanks the Strait of Hormuz, a choke point at the
southern end of the Gulf through which around 40 percent of the
world's seaborne oil trade passes.
Oil prices, which fell from a peak near $150 a barrel last
July to the low-$30s late last year, have been buoyed recently
by hopes of economic and demand recovery.
But some analysts, including the International Energy
Agency, have warned that the recent price rally to the highest
settlement since Oct. 20 last Thursday, may not reflect market
balances and may hurt recovery efforts.
French Economy Minister Christine Lagarde said G8 ministers
wanted measures to curb volatility in oil and oil products
markets, which put at risk growing signs that their economies
were heading towards recovery. []
Iraq's oil minister said an oil price of $70 a barrel is
encouraging producers to bring more crude to market but is not
enough to balance supply with demand in the event the world
economy recovers quickly. []
"If there is a quick recovery of the world economy, oil
prices of $70 will not be enough to balance produced crude and
demand and prices will continue rising," Hussain al-Shahristani
told Reuters.
Algeria's Energy and Mines Minister Chakib Khelil said
global oil markets could stabilise if crude prices rise to
around $90 a barrel and that is likely to happen in the second
half of 2010. []
(Editing by Michael Urquhart)
