RPT-UPDATE 1-Oil falls over 2 pct towards $50 on flu fears

                                
 * Oil falls 2 pct towards $50 on swine flu fears
                                
 * Banks, Fed Reserve, earnings and swine flu in view
                                
 * Gulf OPEC OK for now with $50 oil, sees risks
 (Changes lead, updates prices)
                                
 By Fayen Wong
                                
 PERTH, April 27 (Reuters) - Oil prices fell over 2 percent
towards $50 a barrel on Monday, paring some of the previous
session's near 4 percent gain, on fears of a global flu
pandemic after an outbreak of swine flu in Mexico.
                                
 The impending release of U.S. bank "stress test" results, a
Federal Reserve meeting and a flood of earnings due later this
week also heightened investor caution. [nN24452036]
                                
 U.S. crude oil futures for June delivery <CLc1> fell $1.08
to $50.47 a barrel by 0033 GMT, erasing some of Friday's gains
of $1.93 that brought the contract to settle at $51.55.
                                
 London Brent crude <LCOc1> fell 77 cents to $50.90.
                                
 "The swine flu in Mexico is also causing some risk aversion
in the markets and is already weighing on the Dow," said Ben
Wesmore, a commodities analyst at the National Australia Bank.
                                
 "Investors are taking caution ahead of a flood of corporate
earnings and economic data this week."
                                
 Worries of a global swine flu, which first emerged in
Mexico, grew over the weekend with new infections in the United
States and Canada discovered on Sunday, and as millions of
Mexico hid indoors to avoid a virus that has already killed up
to 81 people. [ID:nN26482522]
                                
 Reminiscent of the Asian bird flu earlier in the decade, a
swine flu outbreak could become a major setback to the already
fragile state of the world economy, research firm Informa
Global Markets said in a report.
                                
 The U.S. dollar fell to its lowest in a month against the
yen as worries about the spread of the flu from Mexico sent
investors into perceived safe-haven currencies such as the yen
and the Swiss franc. [USD/]
                                
 For more stories on the flu outbreak, click [nFLU].
                                
 World finance leaders on Saturday agreed there was a "break
in the clouds" of the economic storm but said more measures
were needed to ensure an end to the global recession, while a
top U.S. official said the sense of "unremitting freefall" in
the U.S. economy has ended. [nN25478350][nN26489274]
                                
 Oil prices, which have largely stagnated around $50 a
barrel for most of this month, have been tracking equities
closely in recent weeks as investors looked to stocks for signs
of an economic recovery that could revive demand for fuel.
                                
 Gulf oil producers said on Sunday they can tolerate
moderate crude prices for longer to help revive global growth,
but shared a concern with consumer nations that a prolonged
period of low prices could sow the seeds of a future fuel price
spike. [ID:nT342749]
                                
 OPEC Secretary General Abdullah al-Badri separately told
Reuters that world oil prices could recover to $60 per barrel
by the end of the year if the global economy picks up, and it
was too soon to judge if fresh output cuts would be needed when
the cartel next meets on May 28. [ID:nLQ599317]
                                
 Crude oil speculators on the New York Mercantile Exchange
shifted to a net short position in the week to April 21,
according to data from the U.S. Commodity Futures Trading
Commission released on Friday. [ID:nN24434747]
 (Editing by Ben Tan)