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Oil fell for a third day after Greek Prime Minister George Papandreou’s pledge to hold a referendum raised the prospect of the failure of Europe’s bailout plan.
Futures dropped as much as 4.3 percent after Greece’s decision to call a vote on its five-day-old bailout sent equities and the euro lower. Crude climbed 6.8 percent last week, the biggest gain since February, on the European package. China’s Purchasing Managers’ Index fell for the first time in three months in October, a report showed.
Papandreou’s referendum risks pushing Greece into default if the plan is rejected by voters. An opinion poll published Oct. 29 showed most Greeks believe the accord on a new bailout package and a debt writedown is negative.
A rejection of the EU-IMF aid plan “would increase the risk of a forced and disorderly sovereign default” and raises the chance of Greece leaving the euro, Fitch Ratings said in a statement today.
U.S. regulators are investigating whether hundreds of millions of dollars are missing from client accounts at MF Global Holdings Ltd., according to two people with knowledge of the matter. The firm, which filed for bankruptcy protection yesterday, was ordered by the enforcement division of the Commodity Futures Trading Commission to preserve records for the review, one of the people said.
Oil output in the Organization of Petroleum Exporting Countries rose in October to the highest level in almost three years as gains in Libya and Angola outpaced a Saudi cut, a Bloomberg News survey showed yesterday. Production increased 0.4 percent to average 30.1 million barrels a day, the most since November 2008, according to the survey.
Iraq’s daily oil production capacity will increase by 100,000 barrels to a total of 3 million barrels in the “next few days”, Oil Minister Abdul Kareem Al-Luabi said. The nation produced oil at an average rate of 2.9 million barrels a day in October, he said in an interview in Baghdad today. The country is the only OPEC member without a production quota.
An Energy Department report tomorrow will probably show that U.S. crude oil supplies rose 500,000 barrels, or 0.1 percent, to 338.1 million last week, according to the median of 11 analyst responses in a Bloomberg News survey.
Crude oil for December delivery declined to $89.17 a barrel on the New York Mercantile Exchange. Futures climbed 18 percent in October, the biggest gain since May 2009.
Brent oil for December settlement dropped $2.25, or 2.1 percent, to $107.31 a barrel on the London-based ICE Futures Europe exchange.
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