Oil falls as weak US data fuels selling

NEW YORK: Brent crude oil prices fell 2 percent to a nine-month low near $ 101 a barrel on Friday, falling for the third straight session as concerns about the strength of the world economy triggered heavy selling across commodities.
Oil was joined by gold, silver and other metals like copper in losing value.
“There’s an underlying anxiety in the crude market about demand growth going forward into the second half of the year,” said Andy Lebow, vice president at Jefferies Bache in New York.
“Gold came off and industrials are really getting hit today. That’s part and parcel of the anxiety over global demand growth.”
Stephen Schork, the editor of The Schork Report, said losses in one commodity could prompt selling to cover losses in another.
“Margin clerks are definitely calling, so that brought everything down this morning,” he said.
“Oil is in a continued a bear run, but there’s still a considerable amount of length from a Wall Street standpoint, so it smells like more of a liquidation selloff.”
World equities prices retreated on weak data on US retail sales and consumer sentiment, as well as news that Cyprus would ask for billions more in bailout money.
“The retail sales data and weakening consumer sentiment on the heels of news Cyprus needs more money, caps a week of news pointing to weaker economic growth and less demand for oil,” said John Kilduff, partner at Again Capital in New York.
Friday’s weak data from the United States followed forecasts for lower global oil demand growth for 2013 released this week by the International Energy Agency (IEA), the US Energy Information Administration (EIA) and the Organization of the Petroleum Exporting Countries (OPEC).
Brent May crude LCOc1 recovered slightly to $102.27 a barrel at 1:28 p.m. EDT (17:28 GMT), down $2.00 but higher than a session low of $101.09, a drop of more than $3 from Thursday’s close and the lowest price since July.
US May crude was down $2.52 at $90.99 a barrel, having pushed below the 100- and 200-day moving averages.
Both crude contracts were on track to post week-on-week losses of more than 2 percent.
US May RBOB gasoline and heating oil futures also fell sharply on the prospects for lowered demand.
Oil’s price slide was hastened by reports that showed US retail sales contracted in March for the second time in three months and consumer confidence weakened in April, pointing to slowing economic growth in the world’s biggest oil consuming nation.
Cyprus said on Friday that an increase in the cost of its total bailout package from the European Union and the International Monetary Fund to 23 billion euros, 5.5 billion more than it had initially projected in November, would not lead to additional demands on bank depositors.
The problems in Cyprus have added to concerns about the euro zone economy.
Geopolitical tensions in the Middle East, with Syria’s civil war continuing and no resolution in sight of Iran’s dispute over its controversial nuclear program, remain a focus for oil investors.
In Seoul on Friday, US Secretary of State John Kerry warned North Korea it would be a “huge mistake” to test launch a medium-range missile and said the US would never accept the reclusive country as a nuclear power.
Also demanding investors’ attention was a US government agency saying North Korea has a nuclear weapon it can mount on a missile, adding an ominous dimension to threats of war by Pyongyang, but the assessment was swiftly dismissed by several US officials and South Korea.