Reply #5: Oil hovers below $59 as weak economy slows rally

[ozymandius]

SINGAPORE – Oil prices hovered below $59 a barrel Friday in Asia as signs of a weak U.S. economy led investors to mull whether this month's crude rally was justified.

Benchmark crude for June delivery was up 2 cents to $58.64 a barrel by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange. On Thursday, the contract climbed 60 cents to settle at $58.62.

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Investors got more evidence Thursday that global crude demand may be too weak to justify the recent run-up in prices. The Paris-based International Energy Agency cut its global oil consumption forecast for a ninth consecutive month and now expects demand to fall 3 percent in 2009, or about 2.6 million fewer barrels a day than last year.

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In other Nymex trading, gasoline for June delivery fell 0.67 cent to $1.72 a gallon and heating oil dropped 0.47 cent to $1.49 a gallon. Natural gas for June delivery slid 2.9 cents to $4.26 per 1,000 cubic feet.

http://news.yahoo.com/s/ap/oil_prices