reportedly opened fire at a rally in the east usa

Crude oil pared losses after the police in Saudi Arabia, the Middle East’s biggest petroleum producer, reportedly opened fire at a rally in the east of the country.

New York guess handbags futures rebounded from a four-month low and Brent crude, Europe’s benchmark, briefly rose after the report on the gunfire. Oil earlier fell as much as 3.6 percent after U.S. unemployment claims increased and Spain’s credit rating was cut, bolstering concern that the global economic recovery and fuel demand growth will slow.

“When the Saudi Arabia story broke, shorts got scared out of the market,” said Richard Ilczyszyn, a market strategist at Lind-Waldock, a broker in Chicago. “The bad economic data probably led you to believe that growth is not as good as expected.”

In other markets, corn, wheat and rice futures fell after the U.S. said global grain inventories will be higher than expected in February. Orange juice also declined. The UBS Bloomberg Constant Maturity Commodity Index dropped 1.2 percent to 1,736.97. The gauge slid for the fourth straight day, the longest slump since late August.

Oil futures for April delivery declined $1.68, or 1.6 percent, to settle at $102.70 a barrel on the New York Mercantile Exchange. The most-active contract traded at $101.50 before reports of the gunfire.

Brent futures for April settlement slipped 51 cents, or 0.4 percent, to $115.43 a barrel on ICE Futures Europe in London. Earlier, the price slumped as much as 2.1 percent.

Grains Drop

Corn futures for May delivery fell 18.25 cents, or 2.6 percent, to $6.8275 a bushel on the Chicago Board of Trade. The price dropped for the fifth straight session, the longest slump since November.

Bigger corn production than forecast in Brazil and more wheat expected from Argentina and Australia led the U.S. 2011 summer fashion shop Department of Agriculture to boost forecasts for global inventories before harvests this year in the Northern Hemisphere. World rice stockpiles will be 5.3 percent larger than estimated in February.

Tighter supplies amid rising demand helped fuel a rally in crop prices in the past year, as corn, wheat and rice jumped last month to the highest levels since 2008. The gains boosted global food prices to a record in February after surging 25 percent last year, according to the United Nations.

“Production numbers out of some foreign countries are starting to pick up, and in the U.S., there was a slowdown with some export business being shifted to other countries,” said Brian Hoops, the president of Midwest Market Solutions in Yankton, South Dakota. “It probably puts less pressure on the U.S. to produce a big corn crop and a big wheat crop, although it’s still early in the season.”

Wheat futures for May delivery declined 18.25 cents, or 2.4 percent, to $7.405 a bushel, capping an 11 percent plunge in four days.

Rice futures for May delivery plunged by the exchange limit of 50 cents, or 3.7 percent, to $13.05 per 100 pounds, the lowest since Nov. 17.

Orange Juice
Orange juice fell to a three-week low after the USDA unexpectedly boosted its estimate of the Florida orange crop, signaling damage from a December frost was less severe than estimated.

Growers in Florida, the world’s second-largest producer, will collect 142 million boxes of oranges in the harvest that began in October and runs into July, the agency said in a report. That was up 2.9 percent from 138 million projected in February, marking the first increase in four months.

Five analysts in a Bloomberg News survey projected a crop of 136.2 million boxes, on average. Two weeks ago, orange juice reached the highest price since April 2007 after the adverse weather in Florida in December and January. PepsiCo Inc.’s Tropicana unit, the largest cheap guess handbags purchaser of Florida fruit and juice, plans to raise prices on some products.