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Oil prices slip from three-month highs

Aug 17 2012 18:54 Sapa-AFP

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London - World oil prices fell on Friday on profit-taking following recent gains which saw New York and Brent crude hit three-month highs, analysts said.

Brent North Sea crude for delivery in October dropped $1.27 to $114 a barrel.

New York's main contract, West Texas Intermediate (WTI) light sweet crude for September, slipped 39 cents to $95.21 a barrel.

Prices on Thursday reached the highest levels since May on encouraging economic figures in top crude consumer the United States, traders said.

New York hit $95.69 a barrel and Brent $117.03 - although the Brent price was for its September contract which expired at the close of trading on Thursday.

"Brent has fallen... and is thus priced three dollars lower than at close of trading yesterday," said analysts at Commerzbank.

"The drop in price is largely the result of the contract rollover. The October contract, which from today represents the reference price, was trading $2.5 lower than the September contract at the time of the rollover," they added in a research note.

Oil prices meanwhile spiked Thursday thanks to a brighter demand outlook for the world's biggest economy.

Weekly numbers for new unemployment insurance claims, an indicator of the pace of layoffs, came in as expected and in the same range of the past four months.

Elsewhere, July data on new US housing construction, although slightly down from June, gave a picture of an industry steadily picking up pace.

Oil prices had also rallied on Wednesday after the US Energy Information Administration said crude inventories plunged 3.7 million barrels in the week to August 10, far heavier than the market had expected. Falling US inventories indicate stronger demand.

Prices have also won support this week from fresh hopes of more economic stimulus measures by central banks - and notably by the central bank in commodities-hungry China.

Crude futures were also lifted by Middle East unrest and tight North Sea crude supplies, traders said.

market  |  commodites  |  oil
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