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Oil prices fall as global demand weakens

Oil prices dropped 12 cents to $92.07 per barrel Monday amid expectations for weaker demand. The lag in oil prices showed pessimism over the prospects for both domestic and global demand given weak growth in China, the US, and Europe.

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Stringer/Reuters/File
A worker wipes fuel prices from a board as she updates prices at a gas station in Hefei, Anhui province in this February 2012 file photo. Oil prices fell Monday, Oct. 1, 2012 in anticipation of weakening demand in key parts of the globe.
  • By Pamela Sampson AP Business writer

| Bangkok

Oil prices fell on expectations for weaker demand after two closely watched surveys underscored enduring global economic weakness.

Benchmark oil for November delivery was down 12 cents to $92.07 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract rose 34 cents to finish at $92.19 per barrel on the Nymex on Friday.

Brent crude was down 21 cents to $112.18 on the ICE Futures exchange in London.

Japan's central bank on Monday released a survey that shows deepening pessimism over the economy among the country's big manufacturers.

The Bank of Japan's quarterly "tankan" index was minus 3, a worsening from the previous quarter's minus 1.

The survey showed pessimism over the prospects for both domestic and global demand given weak growth in China, the U.S. and Europe.

Meanwhile, a survey by the China Federation of Logistics & Purchasing said its monthly index of manufacturing activity stood at 49.8 points on a 100-point scale. Numbers below 50 indicate a contraction. China's economic growth fell to a three-year low of 7.6 percent in the quarter ending in June.

Traders are now looking to upcoming jobs data out of the U.S. for a read on the health of the world's No. 1 economy.

"With Wednesday's presidential debates and the approaching election, we expect all eyes will be on Friday's non-farm payrolls data," said oil analyst Stephen Schork in an email commentary.

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