Oil falls to near $89 in Asia

Oil prices fell to near $89 a barrel Wednesday in Asia after a U.S. crude supply report showed mixed signs about consumer demand. Benchmark oil for October delivery was down $1.22 to $88.99 at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude added $2.02 to settle at $90.21 on Tuesday. In London, Brent crude for October delivery was down 60 cents at $111.29 on the ICE Futures exchange. In other Nymex trading for October contracts, heating oil fell 0.7 cent at $2.93 per gallon and gasoline futures dropped 2.2 cents at $2.72 per gallon. Natural gas for October delivery rose 0.2 cents to $3.98 per 1,000 cubic feet. The American Petroleum Institute said late Tuesday that crude inventories fell 5.1 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted a drop of 2.9 million barrels. The large drop was likely due to disruptions of crude operations caused by Tropical Storm Lee, analysts said. The International Energy Agency Tuesday cut global oil-consumption forecasts for this year and 2012. US Energy Department will announce its weekly analysis report later Wednesday. Analysts said the US and Europe are likely to take joint efforts to tackle the crisis in an environment where the euro zone debacle is overshadowing tightening supply. They added that resumption of Libya''s oil exports are likely to delay more than expected though it could hardly make any difference in global supplies. Meanwhile the greenback climbed about 0.5% against a basket of currencies in Asian trade Wednesday.