* Firmer dollar weighs, U.S. stocks turn lower
* U.S. crude to average $81.20 in Q2 2010-Reuters Poll
* Coming Up: April consumer data, API stocks report - Tues
(Recasts, updates throughout, changes dateline from LONDON
previous, changes byline)
By Rebekah Kebede
NEW YORK, April 26 (Reuters) - U.S. oil fell below $85 a
barrel on Monday as the U.S. dollar rose against the euro on
the back of lingering doubts over Greece's debt crisis.
U.S. crude for June delivery <CLc1> fell 36 cents to $84.76
a barrel by 11:04 am EST (1504 GMT), after settling up $1.42 on
Friday.
The front-month contract for London ICE Brent crude <LCOc1>
slipped 12 cents to $87.13, after rising to $87.75 earlier, the
highest price since early October 2008.
"Many things are on the table that has brought some
uncertainty on the horizon. After last week's optimism about
the economic recovery... the situation in Greece is far from
being resolved. At the moment, the dollar is stronger, and that
is driving crude prices lower," said Phil Flynn, an analyst at
PFGBest Research in Chicago.
The U.S. dollar <.DXY> firmed against a basket of
currencies and the euro on Monday, pressuring oil prices. As
the dollar strengthens, it makes commodities like oil more
expensive for buyers holding other currencies.
Uncertainty over proposals to curb speculation in energy
markets could add to oil price volatility this week, as the
Commodity Futures Trading Commission's public comment period
ends on Monday.
Some of the biggest players in U.S. energy markets have
told the CFTC that its plans to reduce speculation is misguided
and will drive investors to overseas and unregulated markets.
[]
The position limit proposal stems from a spike in oil
futures prices to a record of more than $147 a barrel in 2008.
A Reuters poll on Monday showed that U.S crude oil is
expected to average $81.06 a barrel in 2010. Analysts pointed
to growing demand in emerging economies, especially China, as
prime drivers for the firm forecast. []
SIGNS OF RECOVERY
Weakness in oil prices on Monday reversed last week's
gains. Prices on Friday ended above $85 a barrel, the highest
in a week as robust U.S. economic data boosted expectations of
a sustained recovery in the world's largest energy user.
Last Friday, a government report showed sales of newly
built U.S. single-family homes rebounded in March to touch
their highest level in eight months, as buyers took advantage
of a homebuyer tax credit. []
Also on Friday, new orders for durable U.S. manufactured
goods, excluding transportation, also posted the largest gain
in over two years in March. []
Analysts said Friday's data, coupled with other reports out
this month, showed improving U.S. domestic demand, indicating
economic recovery in the world's top oil consumer.
Traders will look for further clues on economic recovery
from the U.S. April consumer confidence data on Tuesday, as
well as the outcome of the Federal Reserve's two-day,
policy-setting meeting starting the same day.
Analysts widely expect the Fed to keep interest rates near
zero and stick to its pledge of low borrowing costs for an
extended period to foster U.S. recovery.
(Additional reporting by Joe Brock in London, Jennifer Tan,
Alejandro Barbajosa and Wang Tao in Singapore; Editing by
Carole Vaporean)
