1 Aug 2008

Oil drops 2%

7:59 am on 1 August 2008

Oil has fallen in price by more than 2% following weak economic data and shrinking fuel demand in the United States.

US crude traded down $US2.69 on Thursday to settle at $US124.08 a barrel, erasing most of Wednesday's $US4.58 jump. London Brent crude gave up $US3.13 to $US123.98 a barrel.

US gasoline consumption is down about 1.5% on last year as pump prices hit record highs this summer. A report from the Labor Department shows jobless claims have also increased.

Oil is down from a record high of $US147.27 on 11 July.