Oil falls below $74 in Asia as stocks retreat

       Oil prices fell below $74 Tuesday in Asia, taking a cue from weak stock markets and expectations the end of the summer driving season in the US will sap already weak demand.
       Benchmark crude for October delivery was down 50 cents to $73.87 a barrel by late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
       Nearly all regional stock markets were lower yesterday, providing a negative lead for the oil market which often looks to the performance of equities as a gauge of economic optimism and therefore crude demand.
       Oil approached $75 a barrel Monday for the first time in 10 months amid optimism that the worlds economies are on the mend but fell back to settle at $74.37, up 48 cents on the day.
       Expectations that demand for energy will grow, at least for oil and gasoline,were spurred by Federal Reserve Chairman Ben Bernanke, who said Friday the recession-hit US economy is reviving. Bernankes remarks and signs of improvement in the US housing market sent stock markets higher, and that carried over into the new week.
       Despite the optimism about recovery from recession, analysts say energy demand remains in the doldrums and seasonally lower demand for gasoline as the summer holidays end will exacer-bate that weakness.
       Oil at the $70-plus level remain potentially vulnerable because there is little constructive fundamental support,inventories are high and global demand remains weak, said Vi ctor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore.
       In my view, oil prices will likely give in to the fundamentals in the coming week. Seasonally, oil demand is lower in autumn, so reduced demand in the shoulder season may put further pressure on oil.
       In other Nymex trading, gasoline for September delivery fell 0.91 cents to $2.04 a gallon and heating oil was down 2.15 cents to $1.9020 a gallon. Natural gas fell 2.6 cents to $2.897 per 1,000 cubic feet.
       In London, Brent crude was down 64 cents at $73.62.
       Mondays pr ice gains ... could be interpreted as rather impressive given the strengthening in the US dollar and a drop in the equity markets, said ODL Securities analyst Marius Paun in a note to clients.
       Ro bust sentiment on (a) global economic recovery still provides strong support for the energy complex, especially after both (US) Fed Chairman Ben Bernanke and ECB President ( Jean-Claude) Trichet talked about signs indicating the world economy has bottomed.