* Saudi says consumers expect $70-$90 oil, lifts crude
* China, U.S. manufacturing data helps support oil
* Parcel explodes in Athens, police detonate two more
* Coming up: API oil inventory data on Tues, 4:30 p.m. EDT
(Recasts, updates with settlement prices, market activity)
By Robert Gibbons
NEW YORK, Nov 1 (Reuters) - Oil prices rose nearly 2
percent on Monday after comments by Saudi Arabia about
consumers tolerating oil prices as high as $90 a barrel and
unease about a bombs found in Greece fueled earlier gains.
"Consumers are looking for oil prices around $70, but
hopefully less than $90," Saudi Arabia's oil minister Ali
al-Naimi said in comments following a speech in Singapore.
"There's almost an anchor now for the price." []
The comment was interpreted by brokers and analysts as
signaling Saudi Arabia could allow prices to rise as high as
$90, above the $70-$80 range the Kingdom had previously deemed
satisfactory.
Data indicating better-than-expected manufacturing growth
in China boosted oil early and the dollar's intraday weakness
also helped push oil above $83 to a more than two-week peak.
U.S. crude for December delivery <CLc1> rose $1.52, or 1.87
percent, to settle at $82.95 a barrel, having reached $83.86.
In London, ICE December Brent crude <LCOc1> rose $1.47 to
settle at $84.62.
"Naimi's comment is probably the most convincing reason,"
Carsten Fritsch, analyst at Commerzbank in Frankfurt, said
about U.S. oil futures' price spike intraday to near $84.
"It gives assurance that the Saudis won't do anything to
prevent a further rise above $80," he added. "At least until
prices exceed $90."
Trading volumes for U.S. crude and refined oil products
futures were muted ahead of this week's Federal Reserve meeting
expected to result in more monetary easing by the central bank
and to keep pressure on the dollar.
Ahead of Naimi's comments, there was news that a parcel
exploded in Athens and others were intercepted, following
Friday's incidents where packages containing bombs were
intercepted in Britain and Dubai on Friday. []
"You have the weak dollar and China growth and the Fed, but
there is concern about the cargo bombs. It's got shorts nervous
and there is just the fear of the unknown," said Richard
Ilczyszyn, senior market strategist at Lind-Waldock in
Chicago.
Oil received lift early on Monday from unexpectedly strong
manufacturing data out of China. []
The dollar index rose in afternoon trading in New York
after seesawing. The greenback firmed against the euro and yen
on stronger-than-expected U.S. manufacturing data. []
The surprisingly strong U.S. manufacturing growth in
October was probably too little, too late to prevent more
monetary easing by the Federal Reserve. []
The news of a quicker pace of factory growth was also
tempered by a separate report showing U.S. personal income fell
in September while consumer spending remained tepid.
FED EXPECTATIONS
The Fed is widely expected to announce new bond purchases,
known as quantitative easing, to pump more money into the U.S.
economy, when its two-day policy meeting ends on Wednesday.
But producers of dollar-denominated oil have voiced
concerns about the battering recently given the U.S. dollar.
Since October, U.S. crude prices have been stuck in a
$79-$85 trading range, narrower from the range in May, when
both the 2010 low of $64.24 and the year's high of $87.15 were
posted.
Ahead of the week's U.S. oil inventory reports, analysts
surveyed by Reuters on Monday expected crude stockpiles to have
risen last week for the fourth time in five weeks. []
Gasoline stocks were expected to be little changed, while
distillate stocks, including heating oil and diesel fuel, were
expected to have fallen.
(Additional reporting by Gene Ramos in New York and Alex
Lawler in London; Editing by Marguerita Choy)
