SINGAPORE (Reuters) –
Oil fell to $71 on Thursday, extending losses by more than $3 after touching a 10-month high this week, as rising crude and diesel stocks eclipsed healthy economic data from the United States and Europe.

Investors are also edgy about the pace of economic recovery in China, a likely clampdown on lending and plans to curtail overcapacity, prompting falls in equities markets in Shanghai, Hong Kong and Japan.

U.S. crude for October fell 34 cents to $71.11 a barrel by 0641 GMT, retreating further from $75 hit earlier this week, the highest level since October. Brent crude lost 40 cents to $71.25 a barrel.

"The question is whether both the commodities and equities markets have priced in the turnaround in the U.S. housing markets and other data," said Ben Westmore, commodities analyst with National Australia Bank.

He was referring to better-than-expected gains in U.S. housing prices, an increase in durable goods orders and consumer confidence this week, lending new credence to the view that the economy is emerging from recession.

"I don't think the markets will move much more on that."

Eyes will now be on the U.S. GDP and jobless claims data later on Thursday, as well as German consumer sentiment.

Stirring concerns over the growth of the world's No. 2 energy consumer, the Chinese cabinet said on Wednesday it would take steps to curb redundant investment and overcapacity in industries ranging from steel to wind power equipment.

The decision came amid fears that China's $585 billion stimulus plan and a surge in new lending in the first half could trigger wasteful investment and a new crop of bad loans. It followed Premier Wen Jiabao's remarks that the economy faces new difficulties, including trouble boosting domestic consumption.

OVERCAPACITY

Westmore said the oil markets were still weighed down by overcapacity, as shown by recent crude and products inventory data in the world's largest consumer.

U.S. crude inventories rose by 200,000 barrels last week due to a rebound in imports weaker demand from refiners, Energy Information Administration (EIA) data showed, versus analyst expectations for a 1.1 million-barrel decline.

Stocks of middle distillates, which include diesel and heating oil, rose by 800,000 barrels to total 162.4 million barrels last week, up over 30 million barrels against last year, and topping projections of a 300,000-barrel build.

Gasoline stocks fell by a larger-than-expected 1.7 million barrels, against an expected 1 million-barrel fall.

About 72 million barrels of gas oil for heating and jet fuel are also being stored in tankers globally, up from around 62 million barrels in June, at a time of uncertain demand from markets in the West going into the peak winter period.

On current fundamentals, traders do not see prices breaking $75, the level at which they have been taking profits after oil jumped almost 130 percent from the lows at the turn of the year.

Oil's fall, fears that the five-month rally in risky assets may have run ahead of the global recovery and worries over Chinese shares, dampened commodity-linked currencies such as the Australian dollar, as well as the U.S. dollar, against the yen.

Oil has also not received much support from the 2009 Atlantic hurricane season as Tropical Storm Danny, the fourth for this year, posed no foreseeable threat to the Gulf of Mexico oil area and its most likely track was expected to stay well out to sea for the next few days, the U.S. National Hurricane Center said.

(Editing by Clarence Fernandez)

WASHINGTON – Astronomers have found what appears to be a gigantic suicidal planet.
The odd, fiery planet is so close to its star and so large that it is triggering tremendous plasma tides on the star. Those powerful tides are in turn warping the planet's zippy less-than-a-day orbit around its star.
The result: an ever-closer tango of death, with the planet eventually spiraling into the star.
It's a slow death. The planet WASP-18b has maybe a million years to live, said planet discoverer Coel Hellier, a professor of astrophysics at the Keele University in England. Hellier's report on the suicidal planet is in Thursday's issue of the journal Nature.
"It's causing its own destruction by creating these tides," Hellier said.
The star is called WASP-18 and the planet is WASP-18b because of the Wide Angle Search for Planets team that found them.
The planet circles a star that is in the constellation Phoenix and is about 325 light-years away from Earth, which means it is in our galactic neighborhood. A light-year is about 5.8 trillion miles.
The planet is 1.9 million miles from its star, 1/50th of the distance between Earth and the sun, our star. And because of that the temperature is about 3,800 degrees.
Its size — 10 times bigger than Jupiter — and its proximity to its star make it likely to die, Hellier said.
Think of how the distant moon pulls Earth's oceans to form twice-daily tides. The effect the odd planet has on its star is thousands of times stronger, Hellier said. The star's tidal bulge of plasma may extend hundreds of miles, he said.
Like most planets outside our solar system, this planet was not seen directly by a telescope. Astronomers found it by seeing dips in light from the star every time the planet came between the star and Earth.
So far astronomers have found more than 370 planets outside the solar system. This one is "yet another weird one in the exoplanet menagerie," said planet specialist Alan Boss of the Carnegie Institution of Washington.
It's so unusual to find a suicidal planet that University of Maryland astronomer Douglas Hamilton questioned whether there was another explanation. While it is likely that this is a suicidal planet, Hamilton said it is also possible that some basic physics calculations that all astronomers rely on could be dead wrong.
The answer will become apparent in less than a decade if the planet seems to be further in a death spiral, he said.
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On the Net
Nature: http://www.nature.com/nature
WASP group: http://www.superwasp.org/

WASHINGTON (Reuters) –
His healthcare reform plan is stumbling, the economy is still sputtering and violence is up in Iraq and Afghanistan. Who wouldn't want a break?

President Barack Obama is officially taking one next week when he heads to Martha's Vineyard. But his long "to do" list -- two wars, worldwide recession and a host of legislative battles in store when he gets back, most notably the struggle over reforming the U.S. health system -- will make it hard for him to relax and disconnect.

Obama is the best salesman for healthcare reform, economic stimulus and other domestic agenda items, and his absence could hurt, analysts said.

But they note he will be gone for only a week, never be far from the issues, and will likely speak out while he is away.

Some critics have questioned whether the president should take a vacation at all, especially given the country's stubborn economic problems and the vehemence of opposition to the $1 trillion healthcare plan.

Others have slammed him for heading to a Massachusetts resort island known as a haven for the rich and famous.

"The American people are looking to you, Mr. President. They'll follow your lead," said Robert Guttman, director of the center on politics and foreign relations at Johns Hopkins University. "Why not lead them to the places that need your help the most, instead of to an already financially stable and prosperous New England island? America's heartland is calling, Mr. President, won't you answer their call?" he wrote on the liberal Huffington Post website.

The administration says Obama is doing only what other presidents, and many other Americans, do: taking a needed break during a busy year in a place the suits his family. The White House stresses that Obama is footing the bill himself -- estimated at $25,000 or more -- for the 28-acre (11-hectare) Blue Heron farm he is renting for the August 23-30 trip.

AS LONG AS THERE'S NO DISASTER

Officials have said Obama planned to spend much of his time relaxing with his family. But he will keep the healthcare message moving while he is away, spokesman Robert Gibbs said.

"Obviously, we'll have some scheduling updates for you throughout the week on events that may or may not be added on healthcare," Gibbs said this week.

"Obviously, there will be a certain point in which the president will largely be down enjoying his vacation," just like millions of other Americans, Gibbs said.

Obama has said he does not think the public will begrudge him the time off with his daughters, despite the bad economy.

Historians note that every U.S. president wants to leave Washington for at least some time in the steamy month of August, and say Obama is spending far less time away than most of his recent predecessors, who would leave the White House for weeks in the summer.

The public usually doesn't balk if the vacations are not too long and if the president is not on holiday when there is a natural disaster. President George W. Bush was often assailed by critics for his long stays at his Texas ranch, and never more so than when he was seen as remaining there too long after Hurricane Katrina devastated New Orleans in 2005.

Presidents never actually leave their jobs, and travel with big entourages of staff, security and the press, noted Stephen Hess, a former presidential adviser now at the Brookings Institution in Washington.

"Their 'vacations' do not disconnect them with the presidency. Nor, for that matter, do they look an awful lot like our vacations," Hess said.

While national leaders feel obliged to take a certain type of holiday -- recent Republican presidents such as Bush and Ronald Reagan were regularly photographed at their ranches engaged in outdoors activities like clearing brush and riding horses -- most Americans do not fault them for taking some time off, given the amount of work they do.

Commentators say Obama has had a very busy first seven months in office, pushing through a massive economic stimulus package, fighting for healthcare and other domestic programs and traveling to Europe, Africa and Mexico.

"The basic proposition that these are bad times, and shouldn't the president stay back at the White House, I don't think is really one that troubles Americans or the world," Hess said.

(Editing by Anthony Boadle)

WASHINGTON – Former Homeland Security Secretary Tom Ridge claims in a new book that he was pressured by other members of President George W. Bush's Cabinet to raise the nation's terror alert level just before the 2004 presidential election.
Ridge says he objected to raising the security level despite the urgings of former Defense Secretary Donald H. Rumsfeld and then-Attorney General John Ashcroft, according to a publicity release from Ridge's publisher. He said the episode convinced him to follow through with his plans to leave the administration; he resigned on Nov. 30, 2004.
Bush's former homeland security adviser, Frances Townsend, said Thursday that politics never played a role in determining alert levels.
Two tapes were released by al-Qaida in the weeks leading up to the election — one by terrorist leader Osama bin Laden and the other by a man calling himself "Azzam the American." Terrorism experts suspected that "Azzam the American" was Adam Gadahn, a 26-year-old Californian whom the FBI had been urgently seeking.
Townsend said the videotapes contained "very graphic" and "threatening" messages.
Townsend said that anytime there was a discussion of changing the alert level, she first spoke with Ridge and then, if necessary, called a meeting of the homeland security council comprising the secretaries of defense and homeland security, the attorney general and CIA and FBI directors. The group then made a recommendation to the president about whether the color-coded threat level should be raised.
"Never were politics ever discussed in this context in my presence," she said.
Asked if there was any reason for Ridge to have felt pressured, Townsend said: "He was certainly not pressured. And, by the way, he didn't object when it was raised and he certainly didn't object when it wasn't raised."
Ridge's publicist, Joe Rinaldi, said Ridge was out of town and was not doing interviews until his book, "The Test of Our Times: America Under Siege ... and How We Can Be Safe Again," is released on Sept. 1.
In 2004, Ridge explained why he didn't feel the alert should be raised. "We don't have to go to (code level) orange to take action in response either to these tapes or just general action to improve security around the country," he said then.
In 2005, months after he resigned, Ridge said his agency has been the most reluctant to raise the alert level. "There were times when some people were really aggressive about raising it, and we said, 'For that?'" he said during a panel discussion in May 2005. But his book appears to be the first time he publicly attributes some of the pressure to politics.
The Homeland Security Department, which Ridge was the first person to lead, faced criticism in 2004 from Democrats who alleged that raising the alert level was designed to boost support for the Bush administration during an election year.
Ridge, a former Republican congressman and governor of Pennsylvania, was widely named as a potential running mate to John McCain in 2008 before the GOP candidate chose Alaska Gov. Sarah Palin.