World oil prices slid today despite a fall in stockpiles of US crude, with analysts saying the figures did not point to a pick-up in energy demand in top consumer the US.
New York's main contract, light sweet crude for delivery in July, lost 90 cents to $98.47 a barrel.
Brent North Sea crude for July shed $1.91 to $118.25 in late London deals. Losses for Brent were exaggerated by profit-taking on the contract's last trading day.
The US Department of Energy said crude stockpiles slumped 3.4 million barrels last week, six times greater than expected by analysts. Rather than a spike in demand, the drop was largely due to supply disruption, analysts said.
The American Petroleum Institute yesterday forecast a three million barrel decrease in crude oil inventories for the week ending June 10, double initial predictions and a sign that demand was picking up.
Oil prices had rallied yesterday in nervous trade, with New York crude closing up $2 as the market welcomed encouraging US economic data.
Goldman Sachs, meanwhile, warned in a market analysis that the bigger picture is rising demand forcing a tightening of supply.
'With world economic growth continuing to drive oil demand growth well in excess of non-OPEC production growth, the oil market continues to draw on inventories and OPEC spare capacity in order to balance,' Goldman analysts said.
'In our view, it is only a matter of time until inventories and OPEC spare capacity will become effectively exhausted, requiring higher oil prices to restrain demand, keeping it in line with available supplies,' they added.