Oil prices fell more than 2 percent Thursday as the global economic slowdown took a toll on China.
China, the world's second-largest oil consumer behind the U.S., has been pushing up oil demand as its economy expanded. But a drop in its export growth last month showed that it's been affected by the sluggish U.S. and European economies. Consumers are spending less and buying fewer Chinese products. If China's exports continue to cool off, its economy will slow and its appetite for oil will diminish.
"We're interconnected," independent analyst Andrew Lipow said. "A slowdown in consumption in the U.S. and Europe is being felt over there."
Benchmark crude fell $2.16, or 2.5 percent, to $83.40 per barrel in New York on Thursday. Brent crude, used to price many international kinds of oil, lost $1.09, or at $110.27 a barrel in London.
The most recent economic data in the U.S. showed little sign of the economy picking up steam. The number of people applying for unemployment benefits fell slightly last week, but not by enough to signal job growth.
And the Energy Department said that oil and natural gas supplies grew unexpectedly last week, while refineries slowed down and gasoline supplies dropped — all signs of soft demand.
Gas pump prices in the U.S. rose more than 2 cents on Thursday to a national average of $3.426 per gallon, according to AAA, Wright Express and Oil Price Information Service. A gallon of regular is about 57 cents less than its 2011 peak near $4 per gallon. It's about 61 cents higher than a year ago.
In other energy commodities trading, heating oil was virtually unchanged at $2.9387 per gallon, while gasoline futures fell 2 cents to $2.7258 per gallon. Natural gas rose 4 cents to $3.529 per 1,000 cubic feet.
© Copyright 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.