Oil prices dip under $ 79; firmer dollar weighs

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SINGAPORE, Oct 9 (Reuters) Oil prices steadied just under after slumping nearly 3 percent a day ago amid a commodities-wide slide tied to a rebound in the US dollar.

US crude futures slipped 10 cents to .92 a barrel by 0144 GMT, after hitting a three-week low of .35 a barrel on Monday. London Brent crude fell 17 cents to .41.

''The strengthening of the dollar has had a slight impact on the price of oil,'' said Gerard Burg, Minerals and Energy Economist at National Australia Bank.

But he also cited the passing peak of the Atlantic hurricane season, which officially runs through November but has yet to exact any significant damage on oil or gas infrastructure.

The dollar has risen following a report issued late last week that showed September US jobs growth posted its best performance since May, stemming concerns that the world's top energy consumer was set to tip into a recession.

Oil prices hit a record high of .90 a barrel on September 20, after the US Federal Reserve cut interest rates in a bid to calm credit markets, sending the dollar lower. The dollar stayed near a two-month high versus the yen on Tuesday.

The new executive director of the International Energy Agency, Nabuo Tanaka told Reuters on Monday that high prices would eventually hurt consuming nations' economies, but stopped short of calling on OPEC to further increase output.

Attention later this week will turn to US data, expected to show a 600,000 barrel build in crude stocks, a 600,000 barrel draw in distillates and a 100,000 barrel fall in gasoline inventories, according to a preliminary Reuters poll.

The weekly data will be released a day later than usual on Thursday due to the Columbus Day holiday.


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