Oil fell today on further signs of easing demand in the world's top consumers and the deepening economic crisis, and as equities ebbed on fading optimism about a US bank rescue plan.
Data showed rising crude stocks in the United States and a fall in crude imports and rise in gasoline stocks in Japan, the world's biggest and third-biggest oil users respectively.
Oil demand is suffering as economies slow, and new evidence of the effects of the financial crisis came from Japan, which posted another record drop in exports in February as world demand for cars and electronics suffered.
US light crude for May delivery fell 72 cents to $53.26 a barrel by 0654 GMT, after touching a near three-month high above $54 yesterday.
London Brent crude fell 80 cents to $52.70.
The worldwide recession is hammering demand for oil, reflected in the latest data.
The American Petroleum Institute said yesterday that commercial crude oil inventories rose by a bigger-than-expected by 4.6 million barrels last week, and a Reuters poll of analysts forecasts the more closely followed Energy Information Administration numbers later today to also show a crude build.
Energy demand in the United States has been hard-hit by the economic meltdown, and global consumption has been shrinking for the first time in a quarter century, bringing oil prices to below $33 last December.
Other major consumers are also feeling the pinch, with Japan's crude oil imports falling to their lowest for the month of February in 20 years.
Adding optimism amid the gloom, a Chinese central bank adviser said the world's number three economy has touched bottom, citing a 25-percent rise in car sales and accelerating investment in the country as signs of economic recovery.
"Before (the economy) bottoms out, it has to bottom. I believe it has bottomed, with the stimulus package and signs of recovery in some industries," said Fan Gang, who sits on the Chinese central bank's monetary policy advisory committee, in a Reuters interview in Hong Kong.
Reuters