* Oil down over 2 pct towards $51 as investors take profits
* U.S. auto task force rejects GM, Chrysler turnaround
plans
* Japan Feb industrial output falls 9.4 pct mth/mth
(Updates prices, adds rejection of GM, Chrysler turnaround
plans)
By Fayen Wong
PERTH, March 30 (Reuters) - Oil fell more than 2 percent to
hover near $51 a barrel on Monday, extending the previous
session's losses, as a bleak near-term energy demand outlook
prompted investors to take profit on its recent rally.
Analysts say the U.S. government's rejection of turnaround
plans for troubled automakers GM <GM.N> and Chrysler also
dampened investors' sentiments and encouraged further sell off.
U.S. oil for May delivery <CLc1> fell $1.14 to $51.24 a
barrel by 0526 GMT. The contract fell $1.96 to settle at $52.38
a barrel on Friday, pulling back from Thursday's four-month
high.
London Brent crude <LCOc1> fell 95 cents to $53.07.
"The rejection of the turnaround plans has led to a pick-up
in risk aversion, which explains why oil is falling further,"
said Michelle Kwek, an analyst at Informa Global Markets in
Singapore.
Asian shares and U.S. stock futures slumped on Monday,
while safe-haven U.S. Treasuries gained after the Obama
administration's autos task force rejected turnaround plans for
GM and Chrysler, which raised the prospect of bankruptcies that
could further debilitate the already ailing U.S. economy.
[]
Analysts said a recent strengthening of the U.S. dollar,
which rose against other major currencies on Monday, also added
downward pressure on oil prices. []
Oil is up about 14 percent since the start of the month and
is looking for its biggest monthly gains since October 2007,
thanks to rallying stock markets and tightening oil supplies as
the Organization of the Petroleum Exporting Countries (OPEC)
curbs exports.
"The overall demand outlook, at least in the short term,
continues to look quite bleak. The rally seen in the last two
weeks might perhaps have ran its course," said Toby Hassall,
head of research at Commodities Warrants Australia.
Industrial output from Japan, the world's No. 3 energy
consumer, fell by a greater-than-expected 9.4 percent in
February, as weak demand weighed on an economy mired in its
worst recession since World War Two, but factories forecast a
small rise in production in coming months. []
Also casting a pall over oil prices were comments on Sunday
from the Organisation for Economic Cooperation and Development
(OECD) that unemployment was set to reach double digits in many
developing and advanced countries. []
Still, analysts said hopes that the U.S. economy had
finally turned a corner were offering some underlying support
for oil, keeping prices above the psychologically important
$50-level.
President Barack Obama said in an interview published on
Sunday that he saw "glimmers of stabilization" in some areas of
the U.S. economy, including pockets of the domestic housing
market. []
U.S. crude oil <CLc1> had hit its highest level so far in
2009 on Thursday at $54.66 a barrel on expectations that U.S.
government efforts to tackle bad debts and reflate the economy
would help boost oil demand.
But prices fell on Friday as the U.S. stock market
succumbed to profit taking and banks hinted that March had been
a tougher month than the previous two. []
(Editing by Clarence Fernandez)
