Oil down, kiwi dollar up overnight

Oil prices have plunged and the New Zealand dollar has risen in overnight trading.

The price of a barrel of crude oil has fallen more than US$6 to US$138 after US President George Bush announced plans to promote offshore drilling. He wants more drilling off the east and west coats and in Alaska.

Two bans exist restricting drilling off most of America's coast. One is from the president, which has been lifted, but the ban from Congress remains and Mr Bush is urging Congress to relent.

He says American families are facing a time of stress with falling home values and high fuel prices.

Mr Bush's plans also include stabilizing finance companies Fannie Mae and Freddie Mac by providing capital and possibly stock. Share prices in the two firms plunged last week amid fears they were holding billions of dollars in bad loans.

Home prices across America are currently down 15 per cent compared with last year.

As America works through its economic woes, the New Zealand dollar has risen more than three-quarters-of-a-cent against the greenback overnight to trade at 77.27 US cents.

- NEWSTALK ZB