* U.S. crude below $100
* Earthquake
Japan's largest in 140 years
* Some refineries, nuclear power plants, manufacturers shut
(Updates prices)
By
Ikuko Kurahone
LONDON, March 11 (Reuters) - Oil slid by on Friday, with U.S. crude falling below $100, after an earthquake rocked
Japan, created a 10-metre tsunami and shut down dozens of plants in the world's third-largest
oil consumer. The
oil market was also keeping an eye on a planned day of demonstrations in
Saudi Arabia, the world's top
oil exporter, and violence in
Libya, which has disrupted its
oil exports.
U.S. crude fell to as low as $99.01 a barrel and was trading at $100.44 a by 1544 GMT. ICE Brent crude fell $1.40 to $114.07 a barrel. It has fallen from a 2-1/2-year high of $119.79 on Feb. 24. Metals and soft commodities also fell.
Japan was hit by a magnitude 8.9 earthquake, the largest since observations began in the late 19th century. About 200-300 bodies were found, said police in Miyagi, northern
Japan, where the quakes and the tsunami hit the hardest. The death toll was expected to rise.
"We need to think what the potential impact on Japanese economy from the quake will be and what the impact on global economy will be,"
Olivier Jakob with Petromatrix said. "That may weigh on
oil demand from
Japan and the
oil price."
Japan is the third-largest
energy consumer after
China and the
United States and imports almost all its
energy needs.
Some refineries and nuclear power plants were shut, and analysts pointed out the shutdowns might increase demand for imports of refined products and fuels for electricity generators.
"Short-term the disruption in activity will be clearly negative for Japanese
oil demand, but you may find that post the initial impact of the tsunami, there will be a need to deliver
oil products to meet demand if you suffer losses in refinery output," said
Harry Tchilinguirian,
BNP Paribas' head of commodity markets strategy.
The earthquake triggered a 10-metre tsunami that swept away everything in its path, including houses, cars, ships and farm buildings, and then spread across the Pacific.
The
Japanese government declared an emergency at nuclear power plants and evacuated thousands of residents. No
radiation leak had been reported so far.
Jakob and Tchilinguirian also pointed out the potential for increased demand for
natural gas and
fuel oil from power producers to compensate for shutdowns of nuclear capacity.
MIDDLE EAST PROTESTS
In the
Middle East, police flooded the streets of Saudi Arabia's capital to deter a planned day of demonstrations, while a small Shi'ite demonstrated was reported in Hofuf, in the
oil-producing east.
In
Libya, forces loyal to Libyan
leader Muammar Gaddafi entered the
oil port of Ras Lanuf in the east of the country and were fighting for control of the town, rebels said on Friday. "Looking further forward it would be optimistic to expect Libyan
oil production to return to normal levels this year,"
Lawrence Eagles with J.P. Morgan said in a research note.
Elsewhere in the region,
Bahraini police blocked several thousand protestors from reaching the royal palace. In
Yemen, tens of thousands of protestors marched in the capital, and protests turned violent in the southern port city of
Aden. Kuwaiti riot police fired
tear gas to break up a small, peaceful demonstration by stateless Arabs demanding greater rights.
European shares fell to a three-month low after the quake in
Japan and on growing unrest in the Arab world. U.S.
retail sales rose 1 percent, the largest gain since October. But it did not reverse the fall in
oil prices.
(Reporting by
Ikuko Kurahone, additional reporting by Alejandro Barbajosa in
Singapore; editing by
James Jukwey and
Jane Baird)
