An oilman prepares to fill his truck with home heating fuel at a depot in Quincy, Mass., April 20, 2011. THE CANADIAN PRESS/AP, Charles Krupa
October 03, 2012 - 7:56 AM
The price of oil fell to near US$91 Wednesday amid concerns about an economic slowdown in Europe, China and the United States.
By early afternoon in Europe, benchmark West Texas Intermediate crude was down 72 cents to US$91.17 a barrel in electronic trading on the New York Mercantile Exchange. The contract dropped 59 cents to end at US$91.89 in New York on Tuesday.
Brent crude, which is used to price international varieties of oil, was down 95 cents at US$110.62 a barrel on the ICE Futures exchange in London.
Investors remain concerned about Europe's ongoing financial crisis after Spain's prime minister said a request for bailout funding isn't imminent.
"The oil market has been under pressure for a fourth consecutive day ... amid persistent concerns about a global economic slowdown that currently limits risk appetite," said a report from Sucden Financial in London.
Slower growth in China, which is a huge importer of oil, has also kept a lid on oil prices. Slower growth can cut demand for oil and other energy products.
Worries have also intensified that the U.S. economy will fall off a "fiscal cliff" at the end of the year. That's when tax increases and deep spending cuts will take effect unless Congress reaches a budget deal. A recession could follow.
"There is downside risk in the overall market," said Ric Spooner, chief market analyst at CMC Markets in Sydney. "Oil is one of those commodities where I think demand is well covered by current supply capacity."
In other Nymex energy futures trading, natural gas lost 6.6 cents to US$3.465 per 1,000 cubic feet, heating oil was down 1.28 cents at US$3.1127 a U.S. gallon (3.79 litres) and wholesale gasoline dropped 4.11 cents to US$2.8281 a gallon.
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News from © The Associated Press, 2012