Oil stuck below $76, gasoline prices slide lower

[August 14, 2010]  ASHGABAT, Turkmenistan (AP) -- Gasoline prices are now a penny below where they were a week ago and could head lower after a retreat in oil prices over the past few days.

The national average for a gallon of unleaded gasoline was $2.770 on Friday, compared with $2.776 on Thursday and $2.779 a week ago, according to AAA, Wright Express and Oil Price Information Service.

Oil prices continued slipping after falling more than $5 in the first four trading sessions of the week. Benchmark crude for September delivery fell 35 cents to settle at $75.39 a barrel on the New York Mercantile Exchange, its lowest level in a month.

The rally in early August that pushed prices above $82 has been reversed. Investors appear to be giving into fears that second-half global economic growth will be slower than previously expected.

Andrew Lebow, an oil trader with MF Global in New York, investors have been discouraged by lower-than-expected oil imports in China and the disappointing growth in the U.S. economy.

"A lot of optimism that we had a few weeks ago has been dashed," Lebow said.

On Friday, the Commerce Department reported that, excluding autos and gasoline sales -- which accounted for one-fourth of the July figures -- retail sales fell 0.1 percent in July, continuing a recent weak trend.

"The ghosts of a global economic slowdown are back and haunting the oil market again," Barclays Capital said in a report. "No doubt, like China, the growth in U.S. oil demand is likely to slow down as the months progress."

In other Nymex trading in September contracts, heating oil was down less than one cent to $1.9956 a gallon, gasoline fell 1.52 cents to $1.9396 a gallon and natural gas gained 3.2 cents to $4.328 per 1,000 cubic feet.

In London, Brent crude was down 29 cents at $75.11 a barrel on the ICE Futures exchange.

[Associated Press; By CHRIS KAHN]

Associated Press writers Pablo Gorondi in Hungary and Alex Kennedy in Singapore contributed to this report.

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