Oil Prices Fall to Lowest Level in Weeks

Source:

"Investors worried about diminished demand for oil in Japan."

Oil prices fell sharply Tuesday on deepening fears about Japan's economy after its nuclear crisis worsened following a devastating earthquake and tsunami.

Dangerous levels of radiation have been reported leaking from a crippled nuclear plant in the northeastern region. The news comes as more than 10,000 people are thought to have died after the nation was hit Friday by the earthquake and tsunami.

Investors worried about diminished demand for oil and other products in Japan, the world's third-largest oil importer. However, Wall Street analysts have said they expect Japan eventually to increase imports of oil, coal and natural gas.

Royal Dutch Shell Plc (NYSE:RDS.A; NYSE:RDS.B) said Tuesday that it will send liquefied natural gas and fuel oil to Japan to help meet power shortages. Japan produces most of its energy from coal-fired power plants, but can also run generators on LNG and even crude oil. Shell says the refineries it operates in Japan were not damaged by the earthquake.

Benchmark West Texas Intermediate crude for April delivery dropped $2.70, or 2.7%, to $98.49 per barrel on the New York Mercantile Exchange after dipping below $97 a barrel earlier in the day.

Brent crude fell $2.84, or 2.5%, to $110.83 per barrel on the ICE Futures exchange.

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