Oil, natural gas prices fall as supply reports spur worries over demand

Oil and natural gas prices fell Thursday on concerns that demand for both is waning.

Benchmark West Texas Intermediate crude for April delivery dropped 94 cents to US$99.43 a barrel on the New York Mercantile Exchange. The contract expires Thursday. Most trading has moved to the May contract, which fell 27 cents to US$98.90 a barrel.

Natural gas lost 12 cents to US$4.37 per 1,000 cubic feet.

A day after the Energy Department’s weekly report on crude oil supplies, traders paid more attention to data showing that supplies rose by nearly six million barrels in the week ended March 14. Oil production continues to rise, but refineries are converting less of it to gasoline and diesel because they’re undergoing seasonal maintenance.

On Thursday, the Energy Department said supplies of natural gas fell by 48 billion cubic feet last week. Analysts surveyed by Platts were expecting a decline of between 57 billion and 61 billion cubic feet. The U.S. supply is still about half what it was this time last year, following the severe winter weather in most of the country.

Brent crude, used to set prices for international varieties of crude, rose 60 cents to US$106.45 a barrel.

In other energy futures trading in New York, wholesale gasoline rose three cents to US$2.90 a U.S. gallon (3.79 litres) and heating oil rose two cents to US$2.92 a gallon.