Oil falls as sluggish demand, ample supplies put pressure on crude prices
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Oil prices retreated Wednesday after a big jump the day before, weighed down by the outlook for ample supplies and weak demand.
Benchmark crude for December delivery was down 53 cents to $88.18 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract rose $3.06, or 3.5 percent, to finish at $88.71 in New York.
U.S. benchmark crude oil prices are expected to be almost 5 percent lower in 2013 than previously forecast amid a sluggish economy, the U.S. Energy Information Administration said in a report. U.S. daily oil production is projected to rise 8.2 percent from 2012 and the highest since 1993, the EIA said.
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Ample supplies and reduced demand combined to put pressure on oil prices.
"Having been arguably too expensive, it has adjusted down to a more neutral price," said Ric Spooner, chief market analyst, CMC Markets in Sydney.
Brent crude, which is used to price international varieties of oil, fell 38 cents to $110.69 on the ICE Futures exchange in London.
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Other energy futures rose in New York trading:
— Wholesale gasoline fell 1 cent to $2.689 a gallon.
— Heating oil fell 0.9 cent to $3.044 a gallon.
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— Natural gas fell 4 cents $3.577 per 1,000 cubic feet.