Oil prices fell 2% today as doubts resurfaced over the pace of economic recovery after US data showed another drop in wholesale business inventories.
Oil followed Wall Street stock prices lower after the US Commerce Department reported that US wholesale inventories plummeted 1.7% in June, and investors worried that businesses were running as lean as possible because of doubts about an economic recovery.
The decline, nearly double analyst expectations and the tenth straight monthly drop, pushed inventories to their lowest level in more than two years.
US crude fell 98 cents to $69.62 a barrel by 6.50pm. In London, Brent crude dropped $1 to $72.50 a barrel.
Optimism that a turnaround in the economy could bolster weak energy demand has helped oil prices recover in the months since crude dropped below $33 a barrel in December.
The Organisation of the Petroleum Exporting Countries forecast the slow recovery in global consumption and rival oil supplies will shrink demand for its crude next year.
Prices rose earlier on news crude imports to China had surged by 42%in July to a record 4.62 million barrels per day. Traders are also awaiting weekly American Petroleum Institute inventory due later today, followed by weekly US government data on Wednesday.
Analysts polled by Reuters forecast the weekly data will show a build in crude oil inventories and a drop in petrol and crude stocks.
