Oil falls as Chinese data fuels demand worry

Tue Apr 10, 2012 5:56pm EDT
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By Robert Gibbons

NEW YORK (Reuters) - Oil suffered its biggest one-day percentage loss of the year on Tuesday, hitting a seven-week low as concerns about a potential slowdown in the economy of No. 2 crude consumer China added to worries about global demand.

March trade data showed China's import growth fell below expectations, indicating tepid first-quarter demand, although imports of crude oil remained high, at the third highest level on record.

"Cumulative economic concerns are haunting the market again with China's import data, last week's U.S. jobs report and Europe still under pressure," said Tom Bentz, director at BNP Paribas Prime Brokerage Inc in New York.

The Chinese data added to overall worries about the global economy, after weak U.S. jobs data late last week dragged oil prices lower on Monday. Oil prices this year have been balancing concerns about demand against supply disruptions - including the potential loss of exports from OPEC member Iran.

The U.S. Energy Information Administration also fed market pessimism with a monthly report that cut its forecast for world oil demand growth for 2012 and 2013, while raising the forecast for non-OPEC oil output.

Brent crude fell $2.79 to settle at $119.88 a barrel, the weakest close since February 17, having dropped below the 50-day moving average of $121.84. The 2.27 percent slide was the biggest one-day percentage loss since December 14.

The front-month Brent May contract expires on Friday.

U.S. crude dropped $1.44 to settle at $101.02 a barrel, the lowest close since February 14, having pushed below the 100-day moving average of $101.65.   Continued...

Gas prices are shown at a gas station in Beverly Hills, California May 20, 2008. REUTERS/Lucy Nicholson