Oil Slips On Questions About Demand

CHRIS KAHN

NEW YORK (AP) — Oil prices slipped Thursday as investors questioned whether the country would regain its appetite for petroleum.

Benchmark crude for December delivery gave up 78 cents to settle at $79.62 a barrel on the New York Mercantile Exchange. In London, Brent crude for December delivery fell 90 cents to settle at $77.99 on the ICE Futures exchange.

While the economy has shown signs of recovery, economists, including those at Cambridge Energy Research Associates, have predicted that world energy demand will continue to slide as automakers build cars with better mileage and countries embrace alternative fuels.

That assessment, combined with Energy Information Administration data that showed a drop in oil imports last week, helped push crude prices lower.

"The good news we're hearing about the economy is not translating to a stronger oil market yet," said Michael Lynch, president of Strategic Energy & Economic Research.

The Labor Department said Thursday that productivity increased and the number of people seeking unemployment benefits for the first time dropped to the lowest level in 10 months. Still, analysts continued to focus on weak oil imports and tepid consumer demand.