London - World oil prices weakened on Wednesday, as the gloomy demand outlook overshadowed concerns about heightened tensions in the crude-rich Middle East region, traders said.
Brent North Sea crude for delivery in November slid 63 cents to $113.87 a barrel in late morning trade in London.
New York's main contract, light sweet crude for November, dropped 77 cents to $91.62 a barrel.
Crude futures had rallied by about $3 on Tuesday, with Brent oil striking a three-week high point on heightened concerns that the Syrian conflict could spread to Turkey.
However, traders shifted their focus on Wednesday back to stubborn demand fears after the International Monetary Fund slashed its economic growth forecasts.
“It seems that gains were short-lived as crude oil prices reversed on Wednesday and gave back recent gains, tracking losses across the equity markets amid global growth concerns that currently weigh on most commodity markets,” said analyst Myrto Sokou at the Sucden Financial Research brokerage.
“Recent solid US economic data provide some initial relief to the markets, but the global economic prospects remain fairly weak and uncertain with potential for a serious slowdown in the oil demand.”
This week, the World Bank and the Asian Development Bank have also slashed their growth forecasts for Asia, a region often seen as a key engine for the world economy as Western economies falter.
In addition, the International Monetary Fund slashed its 2012
global growth forecast to 3.3 percent from its previous estimate of 3.5 percent.
Growth will also only hit 3.6 percent next year - lower than the 3.9 percent predicted in July - as even powerful emerging economies like China, India and Brazil hit the brakes, the Fund said.
“Given that we have continuing concerns over the global economy and the IMF has also adjusted its economic forecasts downward for the world... we are seeing the corrections” to oil prices, Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore, told AFP.
Investors meanwhile remain on edge over flaring tensions between Syria and Turkey.
Turkey's top military commander on Wednesday warned of a stronger response if Syrian shells continue to land on Turkish soil, as Syria's army launched a new onslaught against rebels in besieged Homs city.
President Bashar al-Assad's regime, on the back foot with rebels controlling swathes of north Syria and defying months of army offensives to push them out of key cities, sent reinforcements to a strategic northern town captured by the insurgents on Tuesday, a watchdog said. - Sapa-AFP