Weak German growth drags oil below $94

Associated Press

BANGKOK (AP) — The price of fell below $94 on Wednesday after Germany, Europe's largest economy, reported anemic growth for the first quarter.

Benchmark oil for June delivery was down 64 cents to $93.57 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange.

Germany avoided recession in the first three months of the year, growing 0.1 percent compared with the previous three-month period's 0.7 percent drop. However, traders expected to see slightly stronger growth of 0.3 percent.

On Tuesday, West Texas Intermediate crude fell 96 cents to close at $94.21 after the International Energy Agency raised its forecast for U.S. oil production while cutting its prediction for global crude demand. Analysts said assessments such as the one from the Paris-based IEA were keeping crude prices in check.

Michael Hewson of CMC Markets said in a market commentary that "rising inventories in the US mean that supply will likely outweigh demand for quite some time to come."

Later Wednesday, the U.S. Federal Reserve will release industrial production data for April while the National Association of Home Builders releases its housing market index for May. The data will help shed additional light on the extent of the economic recovery in the U.S., which in turn could influence future energy consumption.

The IEA predicted growth in global demand would remain subdued throughout 2013.

Brent crude, a benchmark for many international oil varieties, fell 30 cents to $102.21 a barrel on the ICE Futures exchange in London.

In other energy futures trading on Nymex:

— Wholesale gasoline fell 1 cent to $2.828 a gallon.

— Heating oil fell 1.7 cent to $2.856 a gallon.

— Natural gas rose marginally to $4.025 per 1,000 cubic feet.

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