Bangkok - Oil prices fell again on Thursday amid worries about the US economy and signs of a slowdown in demand.
Benchmark oil for November delivery was down 33 cents to $102.33 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract dropped 47 cents on Wednesday to finish at $102.66 a barrel, the lowest closing price since July 3.
Oil has fallen 7 percent since closing at a two-year high of $110.53 on September 6. Since then, diplomatic efforts have averted a US military strike against Syria, and tense relations between the US and Iran have shown signs of a thaw. As a result, the market has removed the so-called political risk premium from oil, which some analysts put at about $5 to $6 a barrel.
But worries about the US economy continued to trouble traders. Orders for durable goods, which are big ticket items expected to last at least three years, increased a disappointing 0.1 percent in August, held back by a decline in demand for defence aircraft and other military goods.
Meanwhile, demand for so-called core capital goods rose 1.5 percent, not enough to reverse the decline of 3.3 percent the previous month. Core capital goods are a good measure of businesses' confidence in the economy and include items that point to expansion, such as machinery and computers.
“This suggests that businesses continue to remain cautious on spending amidst uncertainties,” said Cynthia Kalasopatan of Mizuho Bank Ltd in Singapore in a market commentary.
Meanwhile, supply numbers pointed toward a possible slip in demand. The American Petroleum Institute reported a slight drop in US crude oil for the week ended September 20 while the US Energy Department said supplies increased by 2.6 million barrels that week.
Brent crude, the benchmark for international crudes used by many US refineries, slipped 11 cents to $108.21 a barrel on the ICE Futures exchange in London. - Sapa-AP