Oil steadies around US$73; dollar reaches 7-month high

Traders said the stronger dollar, which tends to move inversely to many commodities because they are priced in the U.S. currency, worries about the health of the euro zone and weaker equities were a powerfully negative combination for oil.

But the market gained some support from oil-focused hedge fund BlueGold, which denied what it said were false rumors about its continuing operations and said it was not behind a sharp rise in volatility in recent days.

Rumors over the health of an unidentified hedge fund were cited as a negative factor on Thursday as the oil market fell.

U.S. crude oil for March delivery was up 30 cents at US$73.44 per barrel by 1154 GMT. On Thursday, it touched a 2010 intraday low of US$72.42 and closed down 5 percent. London ICE Brent for March was up 6 cents at US$72.19.

“The market has steadied after yesterday's move,” said Tony Machacek, broker at Bache Commodities in London.

Carsten Fritsch, analyst at Commerzbank in Frankfurt, said oil and commodities markets faced a “toxic mix” of factors including falling stock markets and rising risk aversion.

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