BANGKOK The price of oil hovered near a 3-month low Thursday, held back by worries about the U.S. economy and signs of a slowdown in demand.
Benchmark oil for November delivery was up 7 cents to $102.73 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract dropped 47 cents on Wednesday to finish at $102.66 a barrel, the lowest closing price since July 3.
Oil has fallen 7 percent since closing at a two-year high of $110.53 on Sept. 6. Since then, diplomatic efforts have averted a U.S. military strike against Syria, and tense relations between the U.S. and Iran have shown signs of a thaw. As a result, the market has removed the so-called political risk premium from oil, which some analysts put at about $5 to $6 a barrel.
But worries about the U.S. economy continued to trouble traders. Orders for durable goods, which are big ticket items expected to last at least three years, increased a disappointing 0.1 percent in August, held back by a decline in demand for defense aircraft and other military goods.
Meanwhile, demand for so-called core capital goods rose 1.5 percent, not enough to reverse the decline of 3.3 percent the previous month. Core capital goods are a good measure of businesses' confidence in the economy and include items that point to expansion, such as machinery and computers.
"This suggests that businesses continue to remain cautious on spending amidst uncertainties," said Cynthia Kalasopatan of Mizuho bank Ltd. in Singapore in a market commentary.
Meanwhile, supply numbers pointed toward a possible slip in demand. The American Petroleum Institute reported a slight drop in U.S. crude oil for the week ended Sept. 20 while the U.S. Energy Department said supplies increased by 2.6 million barrels that week.
Brent crude, the benchmark for international crudes used by many U.S. refineries, rose 33 cents to $108.65 a barrel on the ICE Futures exchange in London.
In other energy futures trading on Nymex:
- Wholesale gasoline rose 0.7 cent to $2.664 per gallon.
- Natural gas fell 0.6 cent to $3.487 per 1,000 cubic feet.
- Heating oil rose 1.3 cents to $2.985 per gallon.