Oil drops in Asia as stock markets extend slide

[February 01, 2010]  BANGKOK (AP) -- Oil prices extended losses Monday in Asia as stock markets fell and hopes faded for a sudden revival in energy demand.

Benchmark crude for March delivery was down 23 cents at $72.66 a barrel by early afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract dropped 75 cents on Friday to settle at $72.89.

Asian stock markets were mostly lower, continuing a slide that began over a week ago. Investors discounted stronger-than-expected economic growth in the U.S. last quarter as a temporary bounce back.

Crude prices have fallen more than 11 percent since the start of the year on signs fundamental demand for energy remains weak.

Americans are burning less gasoline than they did a year ago, according to a report last week from the Energy Information Administration. Hopes that China would prop up global demand for crude have dimmed as Beijing takes steps to prevent its economy from growing too rapidly.

All of this means consumers could enjoy cheaper gasoline and lower heating bills, though it usually takes an extended turn in energy prices for the discount to trickle down to the retail level.

In other Nymex trading in March contracts, heating oil was flat at $1.9135 a gallon and gasoline fell 0.5 cent to $1.9086 a gallon. Natural gas fell 13 cents to $5.261 per 1,000 cubic feet.

In London, Brent crude fell 17 cents to $71.29 on the ICE futures exchange.

[Associated Press]

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