* Hungary government says will aim to meet deficit goal
* Coming Up: Euro Zone sentix index for June; 0830 GMT
* For a technical view, click: []
(Adds crude-gold correlation graphic, updates prices)
By Fayen Wong
PERTH, June 7 (Reuters) - Oil fell as much as 2.8 percent
to below $70 on Monday after disappointing U.S. jobs data and
warnings about Hungary's economy re-ignited concern about
energy demand growth and Europe's debt crisis.
The euro fell to a four-year low as investors fled to the
dollar, shedding riskier equities and commodities and sending
Japan's Nikkei average down almost 4 percent to track declines
of more than 3 percent for Wall Street on Friday.
[]
U.S. crude for July <CLc1> tumbled as much as $2 to $69.51,
the lowest since May 26, and was down $1.33 at $70.18 by 0533
GMT, extending Friday's drop of more than $3.
Prices have declined about a fifth from an early-May
19-month high above $87.
ICE Brent crude for July <LCOc1> slid 92 cents to $71.17.
"There are lingering concerns about the European fiscal
problems and also of course the weak U.S. jobs numbers on
Friday also added to the gloom," said Toby Hassall, chief
commodities analyst at CWA Global Markets Pty Ltd in Sydney.
"In addition to that, the strengthening U.S. dollar is also
adding pressure as well. It's a multitude of negative
influences out there that are currently pressuring oil prices."
A stronger dollar renders oil imports more expensive for
European buyers and for consumers in Asia where demand is
surging. The U.S. dollar index <.DXY> rose more than 0.3
percent against a basket of currencies.
Hungary's government sought to draw a line under
"exaggerated" talk of a possible Greek-style debt crisis and
said on Saturday it aimed to meet this year's budget deficit
target. []
Despite attempts to calm markets, Hungary's debt woes have
rekindled fears that more Eastern European nations could reveal
financial frailties.
U.S. jobs data on Friday dented investors' hopes for a
smooth economic recovery in the world's largest energy
consumer.
The data showed nonfarm payrolls rose by about 431,000 jobs
on a surge of temporary hirings for the U.S. Census, but
private employment, which measures the labor market's strength,
rose 41,000, a number that analysts said was disappointing.
[]
Stocks and oil prices could face further pressure this week
unless investors get some relief from worries about Europe,
jobs and the toll they might take on the economic recovery.
[]
The euro <EUR=>, which has turned into the barometer for
investor risk appetite after Greece's debt crisis, fell below
$1.19 to its lowest since 2006.
"The underperformance of crude and flat performance of gold
tell the story clearly; this is not about risk aversion, rather
the familiar theme of end demand," said Geoff Howie, senior
vice president of global futures at MF Global Singapore.
For a graphic showing crude's correlation with gold and the
euro:
http://graphics.thomsonreuters.com/gfx/CT_20100706131756.jpg
Among the week's major economic indicators are U.S. retail
sales and consumer sentiment, both of which should offer clues
on the outlook for spending. Also on tap will be international
trade data.
Still, analysts said the start of the Atlantic hurricane
season this week -- which the top U.S. government weather
agency has warned could be the most intense since 2005 -- would
provide some support to energy prices. []
"In the longer term, oil prices are set to move higher due
to a recovery in demand, but this synchronised upswing of the
global economy is not going to be smooth," Hassall said.
(Additional reporting by Alejandro Barbajosa in SINGAPORE;
Editing by Michael Urquhart)
