Oil price down, US dollar steady

SINGAPORE – Oil prices retreated further on Wednesday as more of the hurricane-hit US oil industry came back on stream, while strong US data lifted Asian export stocks and supported the dollar.

Crude oil fell 45 cents in Asian trade to US$65,51 a barrel – its lowest in two weeks and more than US$5 a barrel off its peak of US$70,85 when Hurricane Katrina shut down swathes of Gulf of Mexico crude and gasoline production. Japan’s benchmark Nikkei average climbed initially along with other Asian bourses, testing a four-year high, after US markets appeared to put the shock of Hurricane Katrina behind them.But by early afternoon, jitters set in ahead of Sunday’s general election in Japan, and the index closed flat.US Institute for Supply Management data, which showed the service sector expanded at a faster pace than expected in August, pointed at US economic resilience ahead of the hurricane.Still, traders see the US currency pressured ahead of a US Federal Reserve decision September 20 on interest rates.Wall Street’s main indexes re-opened on Tuesday after a long weekend to gain more than 1 per cent, helping to lift Hong Kong’s Hang Seng 0,6 per cent and MSCI’s index of non-Japan Asian shares 0,7 per cent by 0702 GMT.On the US Gulf Coast, five of eight storm-hit refineries have now restarted, and traders said industrialised countries’ move to tap emergency supplies also helped avert a crunch.Even so, some 58 per cent of the US’s Gulf of Mexico crude capacity remains shut, according to the US Minerals Management Service.The dollar steadied after rebounding from recent multi-month lows, but investors stayed wary of Hurricane Katrina’s possible implications for US economic growth and monetary policy.The dollar rose to 109,88 yen from 109,64 in late New York trade.It rose 0,4 per cent on Tuesday.- Nampa-ReutersJapan’s benchmark Nikkei average climbed initially along with other Asian bourses, testing a four-year high, after US markets appeared to put the shock of Hurricane Katrina behind them.But by early afternoon, jitters set in ahead of Sunday’s general election in Japan, and the index closed flat.US Institute for Supply Management data, which showed the service sector expanded at a faster pace than expected in August, pointed at US economic resilience ahead of the hurricane.Still, traders see the US currency pressured ahead of a US Federal Reserve decision September 20 on interest rates.Wall Street’s main indexes re-opened on Tuesday after a long weekend to gain more than 1 per cent, helping to lift Hong Kong’s Hang Seng 0,6 per cent and MSCI’s index of non-Japan Asian shares 0,7 per cent by 0702 GMT.On the US Gulf Coast, five of eight storm-hit refineries have now restarted, and traders said industrialised countries’ move to tap emergency supplies also helped avert a crunch.Even so, some 58 per cent of the US’s Gulf of Mexico crude capacity remains shut, according to the US Minerals Management Service.The dollar steadied after rebounding from recent multi-month lows, but investors stayed wary of Hurricane Katrina’s possible implications for US economic growth and monetary policy.The dollar rose to 109,88 yen from 109,64 in late New York trade.It rose 0,4 per cent on Tuesday.- Nampa-Reuters