The price of Brent futures fell towards $103 a barrel today after renewed worries of a slowdown in demand growth from the United States – the world’s top oil consumer.
The Philadelphia Federal Reserve’s quarterly survey of 42 forecasters found the US economy is expected to grow at a slower pace in the second and third quarters of this year.
Additional pressure came from a broad rally in the dollar following strong data on the US labour market. A firm dollar pressures oil as its strength makes commodities more expensive for holders of other currencies.
“A strength in the dollar is weighing on commodities across the board,” said Ben Le Brun, analyst at OptionsXpress in Sydney.
“For oil, worries of ample supplies is putting pressure. We have unprecedented levels of stockpiles in the United States, with uncertainty surrounding economic growth.”
The Organization of the Petroleum Exporting Countries said, however, in a monthly report last Friday that demand for its crude in 2013 will average around 30million barrels per day (bpd), up 90,000 bpd from a previous estimate.
Both world oil demand and demand for OPEC crude will increase in coming months, it said.