Oil Prices Down on Economic Slownes

August 5, 2008 7:59:58 AM PDT
Oil prices fell more than $1 on Tuesday in Asia to near $120 a barrel on expectations the economic downturn in the U.S. will erode consumer demand for crude products. Light, sweet crude for September delivery fell $1.13 to $120.28 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract dropped $3.69 on Monday to settle at $121.41 a barrel.

On Monday, the Commerce Department said consumer spending after adjusting for inflation fell 0.2 percent in June, the biggest drop since February, as shoppers dealt with higher prices for gasoline, food and other items. The weak consumer spending data came despite the arrival of tax rebate checks, part of a stimulus package the government hoped would spur purchasing.