FUNDAMENTL OUTLOOK FOR CRUDE

Oil may slide below $ 100on falling OECD demand.

Oil prices should extend their nearly 30 % slide

and dip into double digits for the first time in

5 months as the U.Soil sector seems to have escaped

severe damage from Hurricane Gustav analyst said.

High fuel prices and the wider economic crisis

have clipprd demand from the U.S and other

large consumer nations this year , dragging

prices from record high over $ 147 a barrel

to below $ 108.

Prices had rebounded last week on fears

Gustav could cause severe disruptions to

U.S oil operations in the Gulf of Mexico.

Early soundings showed little damage

to the sector , however sending oil down again.

Analyst say it is now poised to break $ 100

for the first time since early April.

Oil demand in the U.S , the worlds biggest oil

consumer dropped by 8 lakh barrels per day

in the first half of 2008, the steepest volume drop

in 26 years.

Oil experts have bee revising down price forecast

on the basis of weaker demand projections.

Most recently Lehman Brothers this week cut

its 2008 forecast of Brent crude by $ 3 to $ 112.

Further pressure on crude comes from the

strengthening of the U.S dollar against

other currencies.

On Tuesday oil fell below $ 110 a barrel, a

key support identified by technical analyst

who predict future prce movements by

studying charts.

They have said that the market could fall as

far as $ 60 a barrel before the long tem bull

trend would be broken and ther is strong

support at $ 100.

Iran has said $ 100 is the lowest acceptable

oil price and called for the group to cut

output by 1.5 million bpd by early next year.