Oil prices extended losses on Friday despite official data showing a rapid 5.7 percent economic growth pace by the US in the fourth quarter of last year.
New York’s main futures contract, light sweet crude for delivery in March, dipped 75 cents to settle at US$72.89 a barrel.
London’s Brent North Sea crude for March delivery was down US$0.67 to US$71.46.
The market rose slightly in early trading after the US Department of Commerce said GDP in the fourth quarter rose 5.7 percent in the strongest growth in six years, even though consumer spending, the traditional driver of most economic activity, remained sluggish.
The robust growth in the October-to-December quarter was significantly better than the 4.7 percent expected by analysts but came in large part from businesses ramping up production to rebuild inventories, which economists say may skew the picture of overall activity but is a normal part of recovery.
Inventories accounted for 3.39 percentage points of GDP.
Stripping out inventory adjustment, real final sales — a reflection of the underlying pace of growth — was at a 2.2 percent rate, the report showed.
“While welcome, few believe [the growth] can be repeated in the next period,” said Mike Fitzpatrick, vice president of MF Global.
“Consequently, little of the pessimistic sentiment has been retired, and doubts about the pace and sustainability of recovery remain,” he said.
The GDP report is a key release for the market because the US is the biggest oil-consuming country.
Fitzpatrick said he believed a “precarious equilibrium exists” for oil prices to be between US$67 and US$72.
“If US$72 is breached to the downside, it should take oil for a quick ride down to the US$65 a barrel handle,” said Phil Flynn, senior market analyst with PFG Best.
The rise in the dollar also suppressed oil prices on Friday.
The euro slid to a six-month low below US$1.39 as worries deepened about the state of the European economies in light of Greece’s debt woes, dealers said.
Oil is traded in US dollars and a rise in the currency makes the commodity more expensive to holders of weaker units.
Some analysts said oil prices were stabilizing after falling US$10 in two weeks.
Other commodities:
Copper for March delivery fell US$0.12.45, or 3.9 percent, to settle at US1.394 per kilogram. The contract had fallen 8.7 percent over the previous three days.
April gold dipped US$0.90 to settle at US$1,084.80 an ounce, while March silver fell US$0.228 to US$16.212 an ounce.
Natural gas dropped for the fourth straight day after a new report showed demand has been weaker than expected.
The Energy Information Administration said natural gas supplies dropped by 86 billion cubic feet last week, less than analysts expected.
Reserves remain above average for this time of year.
The natural gas contract for March delivery gave up 8.6 cents to settle at $5.138 per 1,000 cubic feet on the New York Mercantile Exchange.
Benchmark crude for March delivery fell US$0.03 to settle at US$73.64 a barrel on the NYMEX.
Sugar for March delivery rose US$0.064, or 2.3 percent, to settle at US$0.13 per kilogram.
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