Oil prices fell nearly $1 to below $76 a barrel on Friday, pressured by a stronger dollar which outweighed better-than-expected U.S. jobs data.

U.S. crude futures fell 99 cents to settle at $75.47. Brent crude lost 84 cents to settle at $77.52.

The dollar jumped against the yen and the euro, making dollar-denominated commodities like crude more expensive for holders of other currencies, helping pressure prices.

I think right now the big play is the dollar, said Rich Ilczyszyn, senior market strategist at Lind-Waldock in Chicago. The question is whether we get a sustained rise in the dollar ... If you get that crude could go down to $70 or below.

Investors have been looking to economic data for signs of global economic recovery and a potential rebound in energy demand.

U.S. stocks sharply pared gains as the rising U.S. dollar weighed on commodities and risk appetite ebbed. <.N>

In earlier trading, crude rose to near $78 a barrel after the U.S. Labor Department reported that employers cut only 11,000 jobs last month, the fewest in nearly two years. The jobless rate edged down to 10 percent.

But U.S. unemployment remains high and energy fundamentals in the world's largest energy consumer are weak, keeping analysts skeptical about crude's upside potential.

OPEC

Olivier Jakob with Petromatrix said high oil inventory levels in the United States, especially at the delivery point of U.S. crude at Cushing, Oklahoma, have been putting more pressure on U.S. oil prices than on North Sea benchmark Brent crude.

Oversupply and the fragile state of the global economy will be among the issues facing the Organization of the Petroleum Exporting Countries when it meets on Dec 22. Analysts expect no change in OPEC's output policy.

Saudi Arabian Oil Minister Ali al-Naimi told reporters in Cairo that he was satisfied with the trading range of $70-$80 seen in recent weeks.

Right now you see the price is ok between $70 and $80, it's close to the target we set, it's almost $75 -- it's good, Naimi said, referring to the $75 level that he has said suited producers and consumers.

OPEC's Secretary-General Abdullah al-Badri told Reuters on Thursday the group should be cautious as it needs to balance signs of economic recovery and abundant supplies.

He said oil inventories remained above their five-year average and there were 165 million barrels of crude and products floating at sea, equal to almost two days' global demand and more than some estimates.

(Additional reporting by Robert Gibbons and Gene Ramos in New York, Ikuko Kurahone in London and Nick Trevethan in Singapore; Editing by Christian Wiessner)

OPEC