New York - A strong warning from the World Bank that growth in Asia may slow further dragged down the price of oil on Monday.
The World Bank signalled the possibility of a “more pronounced slowdown” in China, the world's second-largest economy after the United States. It also cut its growth forecast for Asia. Red-hot growth in emerging markets like China and India helped boost oil consumption coming out of the global recession.
Benchmark crude fell 57 cents to $89.30 in afternoon trading in New York. The contract hasn't closed lower since August 2.
At the pump, gas prices remain stubbornly high. The national average for gasoline rose three cents over the weekend to $3.818 a gallon. But Californians are now paying an average of $4.668 a gallon, the highest price in the nation, after a jump of 50 cents in the past week. Some motorists there are paying over $5.
In response, Governor Jerry Brown has ordered state smog regulators to allow cheaper winter-blend gas to be sold three weeks early in the state. And Senator Dianne Feinstein has called for a federal investigation because she doesn't think the higher prices are related to supply and demand.
Experts are predicting prices in California could climb to an average of $4.85 before coming down.
In London, Brent crude, which is used to price international varieties of oil, fell 40 cents to $111.62. - Sapa-AP