Oil falls as IEA predicts demand growth will slow
NEW YORK (AP) — The price of oil fell slightly Tuesday after the International Energy Agency predicted demand will grow at a slower pace into next year because of the sluggish global economy.
Benchmark oil dropped 19 cents to end at $85.38 per barrel in New York. Brent crude, which is used to price international varieties of oil, fell 81 cents to $108.26 per barrel in London.
The Paris-based agency lowered its forecast for fourth-quarter oil demand by 300,000 barrels per day to 90.1 million barrels. Its forecast for 2013 dropped 100,000 barrels per day to 90.4 million barrels per day. Meanwhile, global oil supplies increased 800,000 barrels per day to 90.9 million barrels per day in October, the agency said.
The IEA blamed the weak European economy for slowing demand for oil and energy products. Another factor in lower fourth-quarter demand is Superstorm Sandy, which disrupted oil imports and gasoline deliveries on the U.S. East Coast by knocking out power and flooding fuel terminals and refineries, the agency said.
For the week that ended Nov. 9, gasoline demand in the region hit by the massive storm fell nearly 10 percent from the comparable week of 2011, according to John Gamel, a gasoline analyst for MasterCard Advisors SpendingPulse. Demand nationwide fell 4.7 percent.
U.S. gasoline prices appear to have leveled off at an average of $3.44 per gallon, according to AAA, Wright Express and the Oil Price Information Service. The national average has dropped about 35 cents in a month and is just 2 cents higher than it was on this day in 2011.
Among other energy futures on the New York Mercantile Exchange:
— Heating oil fell 3.84 cents to end at $2.961 per gallon.
— Gasoline futures 2.25 cents to end at $2.654 per gallon.
— Natural gas rose 16.9 cents, or 4.7 percent, to end at $3.739 per 1,000 cubic feet.