Oil's slide continues toward $91 a barrel

Associated Press Modified: September 20, 2012 at 7:31 am •  Published: September 20, 2012
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Oil prices fell closer to $91 a barrel on Thursday, sagging for a fourth straight day as high U.S. inventories and weak economic data from Europe, China and Japan reinforced fears of a deeper global downturn.

By early afternoon in Europe, benchmark oil for October delivery was down 45 cents to $91.53 per barrel in electronic trading on the New York Mercantile Exchange. The contract finished at $91.98 on Wednesday, dropping $3.31, or 3.5 percent.

In London, Brent crude traded on the ICE Futures exchange was down 54 cents to $107.65 a barrel.

Figures from Europe, Japan and China reminded investors that the world's economy is struggling, though a positive bond auction from Spain helped limit the retreat in markets.

Among the sobering news for investors was a survey in Europe pointing to a deepening recession in Europe, figures from Japan that showed the country's powerhouse export sector was continuing to suffer and a private survey of manufacturers in China that showed activity fell again in September, though at a slightly slower pace than August.

Signs that the global economy is slowing down tend to push oil prices lower because people and businesses use less energy.

"The extended losses are hinting more and more that the bullish impact of (quantitative easing) had already been priced into the market for several weeks and that the focus is now on weaker global economic growth indicators," said analysts at JBC Energy in Vienna.

Separately, crude inventories grew three times more than analysts had expected last week. Crude supplies grew by 8.5 million barrels to 367.6 million barrels. That's 8.4 percent higher than at the same time last year, according to the Energy Information Administration's weekly report.

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