Oil slips on demand concerns

Crude prices went down Friday as concerns about global oil demand weighed on the markets. The crude prices got pressured after the International Energy Agency said Europe's oil demand that has already been at its lowest level in 20 years after five years of declines is expected to contract further this year. The agency predicted the European oil demand of the Organization of the Petroleum Exporting Countries will fall by 0. 19 million barrels per day in 2013 after a drop of 0.51 million bpd last year due to economic recession, increased energy efficiency and a switch to alternative forms of energy. It had been reported that Saudi Arabia, the world's top oil exporter, cut its oil production to the 19-month low in December, which was also a result of worldwide weak demand. Market sentiment was also hurt by the rising inflation pressure in China, the world's second largest oil consumer. The Chinese consumer price index rose to 2.5 percent in December from a year earlier after a 2-percent gain in the month before. But there were positive news that limited oil's losses. Bank of Japan on Friday decided on a new package of economic stimulus totaling 226 billion dollars. With the biggest spending boost since the financial crisis, Japan's new government hoped to boost economic growth by 2 percentage points and create 600,000 jobs. Markets analysts said the investors will more focus on the debt ceiling negotiations in the U.S. Congress in the first quarter. The headlines from Washington will continue to influence the crude markets. Light, sweet crude for February delivery lost 26 cents, or 0.28 percent, to settle at 93.56 dollars a barrel on the New York Mercantile Exchange. For the week, it added 47 cents, or 0.50 percent. Brent crude for February delivery fell more steeply by 1.25 dollars, or 1.12 percent, to close at 110.64 dollars a barrel, posting a weekly drop of 67 cents, or 0.61 percent.