* Oil falls 5 percent, rout unrelenting
* Deepening financial crisis heightens demand fears
* OPEC to hold emergency meeting on Nov. 18
* IEA may cut demand outlook in report at 0900 GMT
(Updates prices, adds analyst comments)
By Annika Breidthardt
SINGAPORE, Oct 10 (Reuters) - Oil tumbled more than $4 to a
one-year low on Friday as growing fears that financial market
turmoil will squash demand for fuel outweighed the possibility
of an OPEC production cut at an emergency meeting in November.
Commodities have been punished along with stock markets as
investors fear that government invention and a first round of
rate cuts will fail to stave off a global recession as the
financial crisis marches resolutely into a second month.
Investors, who earlier this year piled into oil and other
commodities as a hedge against inflation and the weak dollar,
are cashing out in search of safer havens. The Nikkei index
<> plunged nearly 10 percent on Friday. []
U.S. light crude for November delivery <CLc1> fell $4.19 a
barrel to $82.40 by 0617 GMT, taking its losses over the past
two weeks to 23 percent -- the biggest two-week sell-off since
prices tumbled at the start of the 2003 war in Iraq.
Prices edged up from $82 earlier in the day, the lowest in
a year, as stock markets came off their lows, but have still
fallen more than $60 from its record high above $147 in July.
London Brent crude <LCOc1> shed $3.58 to $79.08 a barrel,
falling below $80 for the first time in a year.
"The oil market fall-out from credit issues leads us to
become considerably more pessimistic about both short-term
demand and medium- and long-term supply," analysts at Barclays
Capital, a long-time market bull, said in a note to clients.
In the latest in a series of dramatic global efforts to
restore faith in the financial system, the United States is
considering guaranteeing billions of dollars in bank debt and
temporarily insuring all U.S. bank deposits, the Wall Street
Journal reported on its Web site. []
That follows a round of global interest rate cuts earlier
this week that failed to stem a dramatic slide across markets.
Investors will this weekend look to Washington, where
finance ministers and central bankers from the Group of Seven
nations will meet amid expectations that the group will present
a united front on policy to contain the crisis. []
OPEC MEETING, IEA REPORT
Following calls from OPEC ministers this week for action to
halt a slide in oil prices, the Organization of the Petroleum
Exporting Countries said it would hold an emergency meeting on
Nov. 18 in Vienna to discuss the impact of the financial crisis
on the oil market.
"OPEC appears to be scrambling to put in another, firmer
floor at $80," said Jonathan Kornafel, Asia director of U.S.
based options trader Hudson Capital Energy.
"The market may still overshoot on the downside regardless
of what OPEC does, as financial flows continue to pour out of
commodities," he added.
The International Energy Agency (IEA) releases its monthly
report on the oil market at 0900 GMT, and investors are
expecting another cut in demand expectations for this year and
next.
The slumping economy has already prompted analysts to
revise downwards their global oil demand growth target, with
the U.S. Energy Information Administration this week cutting
its 2009 projection by 140,000 barrels per day.
(Editing by Jonathan Leff)
