The price of oil fell to near $92 a barrel Friday, dragged down by a combination of lukewarm forecasts for demand and ample supplies.
By early afternoon in Europe, benchmark oil for May delivery was down $1.15 to $92.36 a barrel in electronic trading on the New York Mercantile Exchange.
On Thursday, the Nymex contract dropped $1.13 after the International Energy Agency lowered its forecast for global oil demand in 2013 by 45,000 barrels to 90.6 million barrels a day. Its predictions were similar to those made earlier this week by OPEC and the U.S. Energy Department.
Brent crude, which sets the price of crude used by many U.S. refineries to make gasoline, was down $1.44 to $102.83 a barrel on the ICE Futures exchange in London. Brent has dropped about 12 percent in the past two months amid Europe's ongoing financial crisis, increased supplies and tepid forecasts for demand.
"Concerns about European demand continue to weigh on the oil price," said Michael Hewson of CMC Markets. "U.S. inventories at their highest levels in years and the IEA lowering its forecasts for oil demand are pushing prices lower."
Experts, however, said they expected global demand for crude to strengthen in the second half of the year, leading to higher prices.
Analysts at JBC Energy in Vienna note that demand in financially troubled countries like Spain and Italy has hit a low point and begun to edge up.
They forecast global oil demand this year to exceed 2012 levels by 500,000 barrels a day during the first half of the year and by 1.9 million barrels a day between July and December.
In other energy futures trading on the Nymex:
— Gasoline lost 2.67 cents to $2.8135 per gallon.
— Natural gas added 3.3 cents to $4.172 per 1,000 cubic feet.
— Heating oil fell 3.11 cents to $2.868 per gallon.
Pamela Sampson in Bangkok contributed to this report.
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