Singapore: Oil prices fell to near $69 a barrel Monday in Asia on investor concerns over a weak US economy.
Benchmark crude for July delivery fell 38 cents to $69.17 a barrel by late morning Singapore time in electronic trading on the New York Mercantile Exchange. On Friday, it dropped $1.82 to settle at $69.55.
The July contract expires later Monday. The August contract slid 44 cents to $69.57.
Crude rose to an eight-month intraday high of $73.23 a barrel earlier this month on investor optimism that the US economy, suffering through its worst recession in decades, may grow by the end of the year.
However, recent economic data has been mixed and reflects an economy still struggling to right itself. The Dow Jones industrial average fell 3% last week.
“Oil may have peaked in the short-term,” said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. “The market is overripe for a correction. Eventually the laws of supply and demand will re-exert themselves.”
This week, traders will be looking for signals on consumer demand in a Commerce Department report on May personal spending, which has fallen for eight of the past 10 months. The University of Michigan also reports on June consumer sentiment.
On Sunday, militants of the Movement for the Emancipation of the Niger Delta said they attacked two pipelines belonging to oil giant Royal Dutch Shell in south Nigeria.
Violence has been escalating in the region as the military intensifies operations to flush out rebels battling for a larger share of the country’s oil revenues.
“The recent attacks haven’t had much of an impact on oil because there’s a lot of global spare production capacity,” Shum said. “Oil is everywhere.”
In other Nymex trading, gasoline for July delivery was steady at $1.92 a gallon and heating oil fell 0.50 cent to $1.78. Natural gas for July delivery slid 4.4 cents to $3.99 per 1,000 cubic feet.
In London, Brent prices fell 29 cents to $68.90 a barrel on the ICE Futures exchange.