* Rising U.S. crude, fuel stocks weigh
* Weak euro pressures oil prices
* Concern Greek crisis could spread to Portugal, Spain
* Coming Up: U.S. EIA weekly oil stocks data
(Updates prices, recasts, detail)
By David Sheppard
LONDON, May 5 (Reuters) - Oil fell over $3 to below $80 a
barrel on Wednesday for the first time since March, taking the
week's losses to 7.5 percent as the Greek debt crisis rattled
markets and rising U.S. crude stocks pointed to soft demand.
Prices fell to a low of $79.15, exactly $8, or 9 percent,
below Monday's 19-month high of $87.15.
Rising concerns that Greece's debt crisis could spill into
other euro zone members and derail the global recovery have seen
oil futures shed almost 40 percent of gains seen since February.
"So much good news is already priced into this market that
when sentiment turns gloomy, as it has done with Greece and
Spain, we're bound to see jitters from time to time," said Helen
Henton, head of commodity research at Standard Chartered.
"We are also expecting to see a big increase in U.S. crude
oil inventories later today."
U.S. crude for June delivery <CLc1> was down $3.03 at $79.71
a barrel by 1223 GMT. Prices are still around double the level
they were at the start of 2009.
London Brent crude <LCOc1> was down $3.00 at $82.67 a
barrel.
On Wednesday, Finland's finance minister said there is a
risk Greece's financial problems could spread to Spain or
Portugal, while a senior member of Germany's ruling party said
concerns remain that an international aid package for Greece
could fail. [] []
The euro fell to its lowest level against the dollar since
April 2009 on Wednesday, touching $1.2802. The single currency
is down around 5 cents against the dollar since Monday.[]
Dollar-priced commodities like oil are undermined by
strength in the greenback as they become more expensive for
holders of other currencies. Rising risk aversion is also a
factor as investors pull money out of volatile assets like oil.
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For a graphic on dollar/oil correlation, click
http://graphics.thomsonreuters.com/gfx/RSW_20100405150342.jpg
For a technical chart, click:
http://graphics.thomsonreuters.com/gfx/WT_20100505084256.jpg
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DEMAND WEAKNESS
"The main influences now are the rise in the dollar, the
sovereign concerns in the euro zone spreading into Portugal and
Spain. I think a pretty important factor though, going forward,
is the build in oil stocks in the United States," said Ben
Westmore, an analyst at National Australia Bank.
Crude oil inventories in the world's largest energy
consumer rose by 3 million barrels in the week to April 30, the
American Petroleum Institute said on Tuesday. Analysts polled by
Reuters had predicted a 1.1 million barrel rise.
Gasoline stocks also rose, climbing by 1.5 million barrels
against analyst expectations for a 200,000 barrel build.
Figures from the U.S. government's Energy Information
Administration are due at 1430 GMT on Wednesday.
U.S. demand for gasoline at the pumps, which accounts for
more than 10 percent of total world oil demand, was down 2.3
percent on last year in the week to April 30, the Mastercard
SpendingPulse report showed on Tuesday.
Oil spill workers raced against time in the Gulf of Mexico,
hoping to seize on at least one more day of calm weather in
their fight to contain a huge and growing slick before winds
turn against them. []
Crude oil prices have not been seriously affected by the oil
spill after a deadly April 20 rig explosion triggered a breach
in BP's <BP.L> well.
(Additional reporting by Judy Hua in Singapore; editing by
Amanda Cooper)
