* Euro slumps to four-year low
* Oil down 20 percent since early May
* For a technical view, click: []
(Recasts, adds details, previous dateline PERTH)
By David Sheppard
LONDON, June 7 (Reuters) - Oil fell by as much as 2.8
percent on Monday, with prices briefly dipping below $70 a
barrel, as signs the U.S. economic recovery may be slowing and
warnings about Hungary's debt clouded the outlook for energy
demand.
U.S. crude for July <CLc1> tumbled as much as $2 to $69.51,
the lowest since May 26, and was down 60 cents at $70.92 by 0856
GMT, extending Friday's drop of more than $3.
Prices have declined by around 20 percent from a 19-month
high above $87 a barrel in early May.
ICE Brent crude for July <LCOc1> slid 21 cents to $71.88.
"We expect synchronized selling to continue in practically
all the markets going into Monday's session, with the exception
of the U.S. dollar and treasuries, which will revert to their
role as safe havens," MF Global analyst Edward Meir said.
The euro fell to a four-year low as investors fled to the
dollar, shedding riskier equities and commodities and sending
stock markets in Asia and Europe lower as they tracked declines
of more than 3 percent on Wall Street on Friday. []
Markets have declined sharply since monthly U.S. jobs data
disappointed on Friday, adding fewer jobs than expected while a
large portion were temporary hirings for the U.S. Census.
Adding to investors fears were comments from ruling party
officials in Hungary suggesting it could be heading for a
Greece-style debt crisis.
The euro <EUR=>, which has turned into the barometer for
investor risk appetite, fell below $1.19 to its lowest since
2006.
Hungary's government said talk of a possible debt crisis was
"exaggerated" on Saturday, but fears have been rekindled that
more European nations could reveal financial frailties.
[]
"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 0.1 percent
against a basket of currencies.
Still, 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 -- should provide some support
for energy prices. []
Analysts said below $70 a barrel there was solid support at
$68, which could see prices bounce from here.
"We suspect that improving U.S. demand and the advent of the
hurricane season should prevent protracted declines below $68
support from taking hold," Meir at MF Global said.
(Additional reporting by Fayen Yong in Perth and Alejandro
Barbajosa in Singapore; Editing by William Hardy)
