Oil falls for second day as gasoline demand drops

Spread betting provider City Index takes a look at the financial activity shaping the markets on 13th October 2011.

[ClickPress, Thu Oct 13 2011] Spread betting provider City Index (http://www.cityindex.co.uk/) takes a look at the financial activity shaping the markets on 13th October 2011.

Crude oil prices fell again as slow Chinese imports and decreases in US petrol demand influenced the markets.

At 11:11 BST crude for November delivery on the New York Mercantile Exchange had fallen by almost $1.38 to $84.20 a barrel.

The drop followed a report by the American Petroleum Institute, which showed a 10.5 per cent decline in US gasoline demand for the week to October 7th.

This data represented the biggest fall in gasoline demand for five years and combined with a drop off in Chinese crude imports.

Customs bureau data showed Chinese crude oil imports fell from 4.95 million barrels per day (BPD) in July to 4.92 million barrels BPD in August.

It follows a steep decline that has seen Chinese crude oil imports fail to rise above five million BPD for four months.

HSH Nordbank analyst Sintje Diek had predicted the fall in prices to Bloomberg earlier this year warning that "overall, volatility is very high".

Mr Diek also suggested that the fall could continue: “Oil prices are still high compared to the economic risks we face, not only in Europe but also in the U.S. and Asia."
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