Reply #23: Rita sends oil over $68, safe-havens sought

[UpInArms]

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-09-22T130117Z_01_L2240732_RTRIDST_0_MARKETS-GLOBAL-WRAPUP-4.XML

LONDON, Sept 22 (Reuters) - Crude climbed above $68 a barrel while safe-haven government bonds and gold also rallied on Thursday as Hurricane Rita bore down on the Texas coast, disrupting the U.S. oil industry and rattling insurance stocks.

Oil prices rose more than $2 a barrel on fears that production and refining facilities will take another beating, having barely recovered after Hurricane Katrina ripped through the Gulf of Mexico last month.

Gold rallied to a near 18-year peak as high fuel prices raised concerns about inflation and U.S. economic growth, while euro zone government bond yields hit record lows.

European stocks fell, with insurers like Munich Re (MUVGn.DE: Quote, Profile, Research) and Hannover Re (HNRGn.DE: Quote, Profile, Research) among the hardest hit on speculation they may face larger-than-expected damages claims from Katrina and Rita.

"We don't know how big the (Rita's) impact will be but the market is being quite rightly a bit cautious ahead of what is an unknown," said Adrian Darley, senior investment manager at Gartmore Investment Management in London.

"It's not just the hurricane; U.S. rates are rising along with other different things, and valuations are just not as cheap as they used to be."

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