UPDATE 3-Oil falls $1, nears $100 mark on profit taking

                                
 (Updates prices in paras 2, 4, Cheney's comment in para 9)
                                
 By Fayen Wong
                                
 SYDNEY, March 24 (Reuters) - Oil fell $1 toward $100 a
barrel on Monday, as funds sought to lock in more first-quarter
profits and top exporter Saudi Arabia reassured consumers of
its plans to boost supply in the coming years.
                                
 U.S. light crude for May delivery <CLc1> slid $1.01 to
$100.83 a barrel in Globex electronic trading by 0828 GMT,
after hitting an intraday low of $100.02
                                
 Prices fell almost $9, about 8 percent, last week as
investors fled the commodities complex on fears that gains had
been overdone, giving a lift to the beleaguered dollar in the
process.
                                
 London Brent crude <LCOc1> dropped 83 cents to $99.55.
                                
 "I think there's still a lot of profit taking in the market
and that is pushing down oil prices. The U.S. dollar is also
bouncing back from major currencies, so that's adding to the
downward pressure," said Tetsu Emori, a Tokyo-based fund
manager at Astmax Co Ltd.
                                
 "The market could also be reacting to comments from Saudi
Arabia."
                                
 Saudi Arabia said on Sunday it was working to expand its
oil production and refinery capacity in order to maintain world
economic growth, reaffirming its vow to invest tens of billions
of dollars in new wells and infrastructure. [ID:nL2373685]
                                
 "The kingdom will work with OPEC countries, other producers
and consuming countries towards oil market stability and to
avoid the effects of harmful speculation," the Supreme Council
of Petroleum and Mineral Affairs said in a statement following
a visit by U.S. Vice President Dick Cheney.
                                
 On Monday, Cheney who had met Saudi King Abdullah and the
oil minister, said the kingdom had kept its promise to increase
oil production capacity over the past three years.
[ID:nL24305480]
                                
 Washington has said it wants Saudi Arabia to help raise
OPEC production to ease prices, but the producers' cartel has
resisted pumping more crude due to fears of weakening demand.
                                
 DOWN SHARPLY
                                
 A tumbling U.S. dollar and geopolitics in the Middle East
have helped fuel the recent oil rally. Other commodities have
also hit record highs recently as investors fled stock markets
and took refuge in dollar-denominated assets.
                                
 But oil has fallen sharply from its lifetime high of
$111.80 on March 17, as investors, worried about the outlook of
the global economy, cash in on recent records.
                                
 The dollar continued its uptrend versus the euro on Monday,
gaining 0.5 percent to $1.5360 <EUR=> from late Asian trading
on Friday, rising further from a record low of $1.5905 struck
on electronic trading platform EBS last week. [ID:nT285079]
                                
 OPEC President Chakib Khelil said on Saturday oil prices
would range between $80 and $110 a barrel for the rest of 2008
[ID:nL22663396].
                                
 The reopening of Mexico's oil ports on Friday also weighed
on prices. The government said Coatzacoalcos and Dos Bocas had
opened on Friday after a two-day closure due to bad weather.
                                
 With prices falling at the start of last week, speculators
quickly cut their long positions to reduce leverage in
portfolios and raise cash to meet margin calls stemming from
turmoil in global capital markets, traders said.
[ID:nN21681848]
 (Editing by Ramthan Hussain)