* German Ifo sentiment up in Oct, helps lift oil
* G20 fin mins meet on currencies, dollar seesaws
* Coming Up: API oil inventory data on Tuesday
(Recasts, updates with settlement prices, market activity)
By Robert Gibbons and Gene Ramos
NEW YORK, Oct 22 (Reuters) - Oil prices rose 1.4 percent on
Friday on positive German business sentiment data, French
strikes and a storm threat as the dollar index seesawed and G20
finance ministers met to consider currency policy.
Sources said investors were cautious with a Group of 20
meeting underway in South Korea that looked unlikely to reach a
deal on a U.S.-led initiative for a commitment from emerging
countries to allow their currencies to rise. []
U.S. crude for December <CLc1> delivery rose $1.13, or 1.4
percent, to $81.69 per barrel, as front-month crude eked out a
44 cent gain for the week.
But the December contract, which moved to the front-month
position after the November contract's expiration on Wednesday,
actually lost 24 cents on the week. The week's trading was
volatile. Monday through Thursday saw oil move up 2.25, down
4.32, up 2.87, and then down 2 percent.
Friday's $80.41-$81.94 range was within Thursday's range,
what traders call an "inside day," and total crude trading
volume was at 341,083 lots with 25 minutes left in
post-settlement trading, putting it on track to be the lowest
daily volume since 375,005 lots traded on June 28.
"To me, falling volume and narrower trading ranges imply
that both buyers and sellers are relatively comfortable with
prices where they are. Rising volume and daily trading ranges
occur when people are frantic to exit bad positions," said Mike
Fitzpatrick, vice president at MF Global in New York.
In London on Friday, ICE Brent December crude <LCOc1> rose
$1.13 cents, or 1.4 percent, to settle at $82.96 a barrel.
"The developing currency war and the devaluation war is the
single most important factor for the oil market besides maybe
the rate of Chinese economic growth," said Eugen Weinberg,
commodities analyst at Commerzbank, adding, "the negative
correlation is sustainable in the longer term."
The U.S. dollar index <.DXY> was volatile. An early turn
negative boosted U.S. crude futures as investors bought
commodities as an alternative to holding cash.
The index was lower late in New York and the dollar was
also slightly weaker versus the euro <EUR=> in choppy trading.
The dollar index was down around 7 percent intraday from
September highs, and U.S. oil futures rose 10.5 percent during that period. The greenback's weakness fuels interest in oil and
other commodities among investors looking for better returns.
Failure by the G20 to reach a deal on currencies in South
Korea could weigh further on the dollar, analysts said.
Investors also are waiting for the U.S. Federal Reserve to
take up the question of another round of government debt
purchases, or quantitative easing, at its policy meeting in
November.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic on crude oil and gold correlation with the euro:
http://link.reuters.com/cuw79p
Graphic showing oil's technical outlook:
http://link.reuters.com/duw79p
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While currency disputes helped keep markets on edge, the
battle in France over pension changes has sparked strikes
shutting refineries and disrupting tanker traffic. The French
Senate approved the unpopular pension reform on Friday.
[] []
Investors also eyed a threat from Tropical Storm Richard,
which was expected to strengthen into a hurricane this weekend
and hit Mexico's Yucatan Peninsula next week. The threat to
Mexico's oil-rich Bay of Campeche and U.S. energy facilities in
the Gulf of Mexico remained uncertain. []
Oil received a lift early on Friday when the Munich-based
Ifo think tank said its German business climate index in
October reached its strongest in 3-1/2 years. []
Late on Friday, the Commodity Futures Trading Commission
released data showing that money managers cut net long crude
oil positions held on the New York Mercantile Exchange in the
week to last Tuesday.
(Additional reporting by Emma Farge in London and Alejandro
Barbajosa in Singapore; Editing by David Gregorio)
