Negotiations on the $700 billion rescue of the U.S. financial system stalled as House Republicans rejected the plan and left it to congressional leaders to hammer out a compromise to calm markets. Average consumption of U.S. oil products for the past four weeks was down 6.6 percent from last year, the Energy Department said Sept. 24.
Crude oil for November delivery fell as much as $3.77, or 3.5 percent, to $104.25 a barrel in electronic trading on the New York Mercantile Exchange. It was at $106.05 a barrel at 1 p.m. London time.
Oil is headed for a 0.8 percent weekly increase despite having posted a record one-day gain on Sept. 22, when investors rushed to cover short positions before the October contract's expiry. The financial crisis and plans for its solution have since kept prices within a $4 range.
Gasoline demand averaged 9 million barrels a day in the past four weeks, down 3.4 percent from the same period last year, the Energy Department report showed. Gasoline inventories dropped 5.9 million barrels to 178.7 million barrels, the lowest since 1967. Supply levels prior to 1990 were reported on a monthly basis.
Brent crude oil for November settlement fell as much as $3.40, or 3.2 percent, to $101.20 a barrel on London's ICE Futures Europe exchange. It was at $103 a barrel at 1 p.m. London time.
The Organization of Petroleum Exporting Countries continues to export large volumes of oil as it may take time for the group to cut back output to its quota.
OPEC's daily shipments of oil will increase 2.2 percent in the four weeks to Oct. 11, according to data from industry consultant Oil Movements released yesterday. The group will load 24.75 million barrels a day in the period, compared with 24.21 million barrels a day shipped in the four weeks ended Sept. 13, the Halifax, England-based consultant said.
Gold fell for a fourth day in London as the dollar strengthened against the euro, diminishing demand for the metal as an alternative investment. Platinum also fell. Gold for immediate delivery fell $4.43, or 0.5 percent, to $873.47 an ounce as of 11:52 a.m. in London. Futures for December fell $5.80, or 0.7 percent, to $876.20 an ounce in electronic trading on the Comex division of the New York Mercantile Exchange.