Oil Falls Near Eight-Week Low
Source: Bloomberg, Margot Habiby (1/25/11)
"Crude has dropped for six days since settling at a 27-month high."
Oil tumbled as much as 1.8% as U.S. residential real estate prices declined by the most in a year in November in a S&P/Case Shiller report and U.K. gross domestic product unexpectedly shrank in the fourth quarter. Crude has dropped for six days since settling at a 27-month high of $91.86 on Jan. 12.
"The unexpected contraction of the U.K. GDP is the big news today," said Tom Bentz, a broker with BNP Paribas Commodity Futures in New York. The U.S. housing number "is another bearish signal on top of a market that's already under pressure."
Oil for March delivery declined $1.32, or 1.5%, to $86.55 a barrel at 11:24 a.m. on the New York Mercantile Exchange. Earlier, it touched $86.30, the lowest price since Dec. 2. Futures are down 5.3% this month and have risen 15% in the past year.
The S&P/Case Shiller index of home values in 20 U.S. cities fell 1.6% from November the prior year, the biggest 12-month decrease since December 2009, the group said today in New York.
Britain's economy contracted the most in more than a year as construction slumped and the coldest December in a century hampered services and retailing. GDP fell 0.5% after increasing 0.7% in the previous quarter, the Office for National Statistics said in London today.
The median forecast in a Bloomberg survey of 33 economists was for an increase of 0.5%.
Brent crude for March settlement slid $1.07, or 1.1%, to $95.54 a barrel on the London-based ICE Futures Europe exchange.