Oil drops to near $85 as China trade growth slows
SINGAPORE (AP) — Oil dropped to near $85 a barrel Tuesday after weak Chinese trade figures suggested the economic slowdown in the world's second-largest crude consumer is deepening.
China said Tuesday that June imports increased 6.3 percent, which was less than analyst forecasts and down by half from May's growth rate while export growth declined to 11.3 percent from 15.3 percent in May.
Waning growth in Chinese demand for crude and other commodities suggests global oil consumption might be weaker than previously thought. Crude has fallen from $106 in May amid signs that economic growth in U.S., Europe and China is flagging.
Traders will get more insight into the health of the Chinese economy when second quarter gross domestic product is released Friday.
"The last couple of months' worth of macroeconomic headlines have fomented doubt about the prospects of robust global oil demand through the remainder of 2012," energy trader and consultant The Schork Group said in a report.
Benchmark oil for August delivery was down 98 cents at $85.01 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude rose $1.54 to settle at $85.99 on Monday in New York.
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