Oil extends losses, drops below $75

July 13, 2010 8:32:44 AM PDT
Oil prices fell below $75 a barrel Tuesday in Asia as investors looked for fresh signs of a growing U.S. economy from second quarter corporate earnings reports.

Benchmark crude for August delivery was down 37 cents to $74.58 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract lost $1.14 to settle at $74.95 on Monday.

Oil prices have danced around the $75 level for about a year as the global economy rebounds from last year's recession but growth in developed economies remains sluggish. Burgeoning U.S. crude inventories and weak demand have kept investors from bidding oil higher.

"Without a regular diet of positive economic data supporting the idea of a growing economic recovery, the fundamentals in this market are just not strong enough to support upside movement," Cameron Hanover said in a report.

Traders took some heart from Alcoa Inc.'s second-quarter profit of 13 cents a share, which beat analysts' forecast by one cent. Alcoa, the largest U.S. aluminum producer, is usually the first major company to report earnings, and it said late Monday that revenue rose to $5.2 billion, more than analyst estimates.

Later this week, Intel Corp., Google Inc., JPMorgan Chase & Co., and Bank of America Corp. are scheduled to announce earnings.

In other Nymex trading in August contracts, heating oil fell 0.68 cent to $1.9845 a gallon, gasoline dropped 0.35 cent to $2.0245 a gallon and natural gas rose 2.0 cents to $4.408 per 1,000 cubic feet.

Brent crude was down 30 cents to $74.07 a barrel on the ICE futures exchange.