LONDON, Feb 28: Oil prices fell on Wednesday as most world stock markets sank for a second day on global economic concerns, traders said.
However, price losses were capped by persistent jitters over key crude producer Iran and forecasts of falling energy stocks in the United States.
In London, the price of Brent North Sea crude for April delivery lost 22 cents to $61.14 per barrel in electronic trading.
New York's main oil futures contract, light sweet crude for delivery in April, shed 46 cents to $61 per barrel in electronic deals before the official opening of the US market.
Wednesday's modest price losses “seem to be related to the stock markets slide”, said Global Insight analyst Simon Wardell.
He added that there were “potential concerns that stock market trouble may help or partially lead to lower economic growth this year”.
European indices in Frankfurt, London and Paris slid further on Wednesday, mirroring heavy losses on Wall Street and in Asia on signs of economic slowdown in the United States and an end to a speculative bubble in China.
On Wednesday, however, Shanghai's stock market actually closed up 3.94 per cent on Wednesday, one day after slumping 8.8 per cent -- which was their biggest single day loss in 10 years.
“Crude futures were lower (on Wednesday), still under pressure from renewed concerns over Chinese demand, triggered by a slide in China's major equity indices,” said Sucden analyst Michael Davies.
“However, continuing support comes from worries about Iran's nuclear row with the UN Security council, which is currently considering further sanctions against the country and working on a new resolution to address the problem.” Participants were also nervously awaiting the start of US trading later Wednesday, as well as an update on American energy inventories.
The US Department of Energy's weekly stocks report was forecast to show that distillates — which include crucial heating fuel and diesel -- sank by 2.75 million barrels in the week to February 23.
London analysts also expect that US gasoline or petrol reserves will have fallen by 1.5 million barrels.—AFP