Oil Falls Below USD105

Crude fell below USD105 in overnight trade Tuesday morning resuming a near two-week slide as a resurgent U.S. dollar drove investors away from commodities and OPEC appeared set to sit tight on production policy.

Concerns over Hurricane Ike strengthening in the oil-rich Gulf of Mexico were countered by the greenback's surge to a one-year peak against a basket of currencies after the U.S. government's takeover of troubled mortgage financiers.

October crude fell as low as USD104.77/barrel and was at USD105.43 at 8am London time.

Meanwhile Texas oil tycoon T. Boone Pickens said on Monday he continued to believe that crude prices will not fall below $100 a barrel despite falling gasoline demand.

"I think it will hold there. If it does go below, it won't be for very long," Pickens said on the sidelines of a conference in Kansas City, where he was promoting a plan to use domestic natural gas resources to reduce dependence on foreign oil.

Pickens said he expected no moves by OPEC to limit production. The 13-member Organization of the Petroleum Exporting Countries (OPEC) is due to meet Tuesday and analysts were predicting that the group would hold its production ceiling steady.