Oil falls to near $91 on weak US jobs market

[January 14, 2011]  SINGAPORE (AP) -- Oil prices fell to near $91 a barrel Friday in Asia as traders mulled whether demand in a slowly recovering U.S. economy will be enough to push crude above $100 soon.

Benchmark oil for February delivery was down 19 cents to $91.21 a barrel late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. Crude lost 46 cents to settle at $91.40 on Thursday.

The Labor Department said Thursday that more people filed for unemployment aid last week in the U.S., tempering optimism that a strong economic recovery is under way.

Some analysts expect the U.S. economy to stumble this year, weakening crude consumption and prices. Capital Economics forecasts the oil price will fall to $75 in 2011.

However, most economists -- eyeing signs of improving U.S. crude demand joining still-strong consumption in emerging markets -- expect oil to breach $100 this year.

"U.S. oil demand in the second half of last year finally began to show strong growth again," Morgan Stanley said in a report. "Importantly, we are still some way currently from the oil price challenging overall consumer spending."

Morgan Stanley is predicting oil will average $100 in 2011.

In other Nymex trading in February contracts, heating oil rose 0.8 cent to $2.62 a gallon while gasoline futures gained 1.1 cents to $2.46 per gallon. Natural gas futures added 0.5 cent to $4.41 per 1,000 cubic feet.

Brent crude was up 22 cents to $97.51 a barrel on the ICE Futures exchange in London.

[Associated Press; By ALEX KENNEDY]

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