* May housing starts rebound, producer prices subdued
* Russia says need for new reserve currency; dollar off
* US weekly crude stocks seen falling 1.8 million barrels
(Updates prices, adds quote from Roubini, adds byline)
By Matthew Robinson
NEW YORK, June 16 (Reuters) - Oil rose nearly 1 percent on
Tuesday as the dollar slid and data showing a rebound in U.S.
housing starts stoked hopes the economy may be stabilizing.
U.S. housing starts jumped 17.2 percent in May and new
building permits rose 4 percent -- the biggest advance since
June last year -- boosting U.S. stocks. [] []
U.S. crude <CLc1> traded up 71 cents to $71.33 a barrel at
12:40 p.m. EDT (1640 GMT), while London Brent crude <LCOc1>
gained 74 cents to $70.98 a barrel.
The dollar fell, pressured by comments from Russia
suggesting a need for a global reserve currency other than the
greenback. []
A weaker dollar can strengthen commodity markets by
improving the purchasing power of buyers using other
currencies. The Reuters-Jefferies CRB index <.CRB>, a global
commodities benchmark, traded up 0.12 percent.
"This is largely a dollar play, although the housing and
producer prices data seemed to signal more green shoots," said
Phil Flynn, analyst at Alaron Trading in Chicago.
Expectations of an economic recovery drove crude prices to
a near eight-month high above $73 a barrel last week, more than
double their winter lows.
But some market experts are concerned oil and other
commodities markets are overheating.
Economist Nouriel Roubini told the Reuters Investment
Outlook Summit Tuesday that oil prices above $70 a barrel are
not reflective of fundamentals. []
World energy demand has shrunk since the onset of the
financial crisis for the first time in a quarter century,
bloating stockpiles in consumer nations.
The market is awaiting weekly U.S. inventory data, which is
expected to show a 1.8-million barrel fall in crude oil stocks,
based on a preliminary Reuters poll. []
The American Petroleum Institute (API) will issue its
report on Tuesday, with U.S. Energy Information Administration
data due out on Wednesday.
Energy companies are also storing fuel on tankers, with
some 62 million barrels estimated at sea, according to
shipbrokers and traders. []
Traders were keeping an eye on unrest in Iran, where the
OPEC nation's top legislative body ruled out annulling a
disputed presidential poll but said it was prepared for a
partial recount. []
The 12-man Guardian Council said it was ready to re-tally
votes in the poll, in which hard-line President Mahmoud
Ahmadinejad was declared the runaway winner, sparking the
biggest street protests since the 1979 Islamic revolution.
(Additional reporting by Robert Gibbons, and Gene Ramos in New
York; Christopher Baldwin in London; Chua Baizhen in Singapore;
Editing by David Gregorio)
