Oil fell from the highest level in three weeks, paring a weekly advance, as concern that Europe’s debt crisis will worsen and global commodity demand is weakening countered signs of recovery in the U.S. economy.
West Texas Intermediate futures declined as much as 1.3 percent, snapping the longest run of gains since December. Greece won’t get financial aid until it implements an austerity plan, Luxembourg Prime Minister Jean-Claude Juncker said yesterday. The International Energy Agency reduced its 2012 global oil demand forecast for a sixth month, citing a “darkening” economic outlook, and China’s exports fell for the first time in more than two years. Initial U.S. jobless claims slid by 15,000 last week, the Labor Department said yesterday.
“The market’s losing ground on the Greek concern,” said Gerrit Zambo, a trader at Bayerische Landesbank in Munich. “The demand-supply situation for the rest of the year is not a critical point at this moment. It’s mainly the political and economic situation.”
Oil for March delivery fell as much as $1.33 to $98.51 a barrel in electronic trading on the New York Mercantile Exchange and was at $98.60 at 11:42 a.m. London time. The contract rose a third day yesterday, climbing 1.1 percent to $99.84 for the highest close since Jan. 19.