* Oil falls over $1 to hover below $56 a barrel
* G20 leaders agree rapid action, rescue plan lacks
certainty
* Japan in first recession in 7 years
* U.S dollar strengthens as investors turn more risk
adverse
(Updates prices)
By Fayen Wong
PERTH, Nov 17 (Reuters) - Oil fell over $1 to hover below
$56 a barrel on Monday, near its lowest in almost two years
after a meeting of the Group of 20 major economies ended with
few actual proposals on how they would combat a global
recession.
News that the Organization of the Petroleum Exporting
Countries (OPEC) may wait until its meeting on Dec. 17, instead
of the end of November, to make a decision on whether to cut
production targets again also weighed on prices.
U.S. light crude for December delivery <CLc1> fell $1.16 to
$55.88 a barrel by 0533 GMT, after having fallen earlier to
$55.60. This was just off the $54.67 a barrel low it hit on
Thursday, which was its weakest since January 2007.
London Brent crude <LCOc1> fell 55 cents to $53.69.
"G20 leaders may have urged fast action to deal with the
global financial crisis, but concern over the weakened
international economic outlook still weighs heavily," said
David Moore, a commodities strategist at the Commonwealth Bank
of Australia.
Governments from Washington to Beijing agreed on Saturday
to a raft of fiscal and monetary steps to rescue the global
economy but it was left to individual governments to tailor
their responses to their particular circumstances and troubled
industries. []
Although the package of economic rescue measures agreed by
the G20 countries sought to settle volatile markets and calm
consumer anxieties about leaders' ability to work together, the
proposals did little to alleviate investors' fears.
For more on the G20 summit in Washington, click on []
Oil shrugged off a fall in the U.S. dollar and a recovery
in Asian stocks, which saw a 3 percent surge in Japan's equity
market, despite data showing the world's second-biggest economy
was in recession.
RECESSION
The worst financial crisis since the 1930s has pushed a
growing number of countries into recession, heightening fears
of a sharp slowdown in near-term world energy demand and
accelerating oil's tumble from its July peak of over $147.
Japan, the world's second-biggest economy, shrank 0.1
percent in the third quarter, marking its first recession for
the first time in seven years [] and following other
industrialised economies -- including Italy, Germany, Hong Kong
and Singapore -- into recession as exports are hit by weakening
global demand.
Oil fell over 2 percent on Friday after news of a euro zone
recession and data showing a record decline in U.S. retail
sales stirred concerns of a further drop in fuel demand.
OPEC may have to wait until December to take action to
reach a preferred oil price range of between $70-$90 a barrel
because the effect of its latest cut is not yet clear, the
group's president said on Sunday. []
Chakib Khelil told a press conference that he saw a meeting
of OPEC ministers in Cairo on Nov. 29 as more of a
brainstorming session that might formulate recommendations for
action at OPEC's gathering in Algeria on Dec. 17.
The continuing fall in the oil price has prompted several
OPEC members to call for a further cut in production as they
face reduced revenues and a struggle to finance domestic
projects.
Iran wants OPEC to cut oil output by a further 1-1.5
million barrels per day (bpd) when it meets in Cairo later this
month, while Kuwait, Yemen and Libya have also voiced concern
about the low oil price.
(Reporting by Fayen Wong; Editing by Michael Urquhart)
