Brent crude oil for November delivery was falling $2.39 to $110.91 a barrel and West Texas Intermediate (WIT) light sweet crude oil for October delivery was tumbling $2.43 to $86.62.
On Friday, the highly influential European Central Bank executive board member Juergen Stark stepped down from his post, citing "personal reasons." But sources tell
that it was really over disagreements on the bank's controversial bond-buying program.
His resignation comes at a uncertain time for the ECB, with the eight-year term of its president, Jean-Claude Trichet, ending in October. The eurzone's ability to reach a consensus over solving the region's debt crisis remains at large given the numerous institutions and political obstacles involved in both the core and peripheral countries.
"It is hard to imagine a smooth transition to a more stable equilibrium," Barclays analysts noted this morning.
"Every other day, some little piece of negative news seems to hurt the prospects for recovery there," Cameron Hanover analysts agreed.
Eurozone sovereign debt credit default swaps were widening this morning, reflecting the deep concerns about the region's debt. Meanwhile, the euro was falling 1.2% against the dollar at $1.3722.
On Thursday, Trichet said that downside risks for the region's economy have "intensified."
Remarks from President Barack Obama and Federal Reserve chairman Ben Bernanke were of no help to market sentiment either.
While Obama's announcement of a $447 billion jobs plan before Congress Thursday evening --
-- was more inspiring than Bernanke's vague rhetoric on the economy, it was clear that certain aspects of the package would face fierce resistance from Republican lawmakers.
In his speech in Minnesota on Thursday, Bernanke held back on providing specific action points for stimulating the economy -- only repeating that the central bank is committed to reviving the economy and had tools for reaching this goal.
"General markets, including the crude complex, have taken this news apprehensively, so prices are heading lower into the end of the week," said Summit Energy analyst Matt Smith. "This news is overshadowing the triumvirate of Chinese data releases overnight, which showed inflation, industrial production, and retail sales were all in line with expectations."
October natural gas futures fell 5.6 cents to $3.924 per million British thermal units as storms led to temperatures moderating and lower demand expectations.
Energy stocks were trading in mixed territory.
Triangle Petroleum Corporation
was gaining 4.1% to $5.36;
Northern Oil & Gas
was losing 2.3% to $19.53;
was falling 1.6% to $81.90;
was down 0.8% to $59.36;
( SUG) was down 0.1% to $41.94;
Energy Transfer Partners
was up 0.1% to $44.20 and
Energy Transfer Equity
was lower by 0.9% to $38.11.
-- Written by Andrea Tse in New York.
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