Crude oil slips to near $100 on demand doubts
- Article by: PABLO GORONDI
- Associated Press
- February 14, 2014 - 7:50 AM
Oil prices slipped closer to $100 a barrel Friday as fresh U.S. economic data and higher-than-expected crude supplies pointed to weaker demand.
By early afternoon in Europe, benchmark U.S. crude for March delivery was down 16 cents to $100.19 a barrel in electronic trading on the New York Mercantile Exchange. On Thursday, the Nymex contract eased 2 cents to close at $100.35.
A report showed that cold weather caused U.S. retail sales to drop in January for a second straight month as Americans spent less on autos and clothing and at restaurants during a brutally cold month. Weekly jobless claims were also higher than expected.
Prices "have slipped slightly as weaker than expected initial weekly jobless claims and retail sales put a cap on further price rises on heightened concerns over a weaker short term demand outlook," said a note to clients from Sucden Financial Research in London.
The severe cold weather has mixed influences on energy prices. It has boosted consumption of fuels such as heating oil, but more people staying at home suggest less travel and less use of gasoline.
The Energy Department said crude stockpiles rose 3.3 million barrels last week, more than analysts had expected, while distillate stocks, which include heating fuels and diesel, fell far less than anticipated.
Oil prices near $100 a barrel have also found support in the latest forecasts from the International Energy Agency, the Organizations of Petroleum Exporting Countries and the Energy Information Administration, which upgraded demand expectations.
"European oil demand will continue its falling trend due to substitution effects and efficiency gains but the pace of the decline will be slower as improving economic conditions are positively affecting fuel consumption from the transportation and industrial sectors," said JBC Energy in Vienna.
Brent crude, which is used to set prices for international varieties of crude, was down 5 cents to $108.47 on the ICE Futures exchange in London.
In other energy futures trading in New York:
— Wholesale gasoline shed 0.21 cent to $2.946 per gallon.
— Heating oil added 0.81 cent to $2.9984 a gallon.
— Natural gas gained 12 cents to $5.343 per 1,000 cubic feet.
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