Tomahawk, WI 10/18/2011 (PennyPayDay) – Oil fell for a second day in New York after China said its economy grew at the slowest pace in two years and U.S. crude stockpiles were forecast to increase.Futures dropped as much as 0.5 percent, extending yesterday’s 0.5 percent decline, after China’s statistics bureau said the economy grew at 9.1 percent in the third quarter, less than predicted. An Energy Department report tomorrow may show U.S. crude inventories climbed for a second week, according to a Bloomberg News survey. Technical indicators indicate prices may have advanced too fast to be sustainable.
“The number from China is getting a bit worse than before,” said Ken Hasegawa, an energy trading manager at broker Newedge Group in Tokyo, who forecasts prices will decline $5 a barrel. “If the recovery of the economies in Europe and the U.S. is getting worse, then the economies of China and Asia will show some damage.”
Crude for November delivery fell as much as 40 cents to $85.98 a barrel in electronic trading on the New York Mercantile Exchange. It was at $86.10 at 2:45 p.m. Singapore time. Yesterday, the contract lost 42 cents to $86.38, the lowest settlement since Oct. 13. Prices are down 5.8 percent this year.
Brent oil for December settlement on the London-based ICE Futures Europe exchange dropped as much as 45 cents, or 0.4 percent, to $109.71 a barrel. The European benchmark contract was at a premium of $24 to U.S. futures. The difference narrowed 16 percent yesterday, the most since June 16.
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