Oil and copper fall on economic woes, gold up

By Nigel Hunt

LONDON (Reuters) - Oil hit a year low and industrial metals plunged up to 10 percent on Friday on fears financial turmoil would hit demand but gold rose in a flight to safety.

With equities plummeting, led by the Nikkei's biggest one-day percentage loss since the 1987 stock market crash, investors scrambled out of commodities as concern grew that efforts to unlock battered credit markets were not working.

"In the midst of the bloodbath in the equity markets, gold will probably be the standout winner here," said Adrian Koh, an analyst at Phillip Futures in Singapore.

"I think a lot of people will be speculating about $1,000 gold again, and I personally think it's not very far away."

Spot gold climbed to about $918.00 an ounce, up from $911.50 in New York late on Thursday. Earlier it touched a session high of $931.00, its strongest level since July 29.

"Currently it is fear that is dominating. We are seeing a flight to safety. It is only gold that shines," Peter Fertig, a consultant at Dresdner Kleinwort, said.

Oil fell more than $4 a barrel to a one-year low, depressed by expectations that global demand growth will shrink if the credit crisis pushes the world economy into recession.

U.S. light crude for November delivery fell $4.35 to $82.24 a barrel.