SINGAPORE — Oil prices fell below $80 a barrel today in Asia as signs of slowing growth in China and falling stock markets undermined expectations that demand for crude will strengthen.
Benchmark crude for September delivery was down 64 cents at $79.61 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract lost $1.23 to settle at $80.25 yesterday.
Most Asian and European stock markets fell today after industrial production in China, the world’s biggest energy consumer, fell for a fifth month in July.
Weaker Chinese growth could have global repercussions if it hurts demand for U.S. and European factory equipment, industrial components from Asian economies, oil from the Middle East and iron ore from Australia, Brazil and elsewhere.
Oil has jumped above $80 a barrel several times in the last year but struggled to maintain that level for long amid doubts about the strength of the U.S. economy and demand for crude.
But a report showed U.S. crude supplies dropped last week, suggesting demand may be improving. The American Petroleum Institute said late yesterday that crude inventories fell 2.2 barrels against a drop of 2.4 million barrels forecast in an analyst survey by Platts, the energy information arm of McGraw-Hill Cos.
Inventories of gasoline also fell while distillates rose, the API said.
The Energy Department’s Energy Information Administration reports its weekly supply data later today.
In other Nymex trading in September contracts, heating oil fell 1.78 cents to $2.1076 a gallon, gasoline slid 1.19 cents to $2.0734 a gallon and natural gas was steady at $4.301 per 1,000 cubic feet.
Brent crude was down 58 cents at $79.02 a barrel on the ICE futures exchange.