Oil dropped for a fourth day before Europe’s latest attempt to contain a sovereign debt crisis that threatens to slow economic growth and demand for fuel. Futures in New York fell as much as 0.9 percent today, the longest losing streak since August. European Union finance ministers will hold a conference call today addressing a self- imposed deadline for drawing additional aid and creating new budget rules. Europe’s crude demand may drop 2.8 percent in the first quarter of 2012 from this year’s fourth quarter, the International Energy Agency forecast on Dec. 13. Oil extended its losses after today’s announcement that North Korean leader Kim Jong Il died. “The near-term direction for the economy is downward, so it doesn’t surprise me that you see prices going down,� said Jeremy Friesen, a commodity strategist at Societe Generale SA in Hong Kong who added that Kim's death was probably “net� bearish for the market. “There is still a lot of uncertainty.� Crude for January delivery fell as much as 87 cents to $92.67 a barrel in electronic trading on the New York Mercantile Exchange and was at $92.76 at 12:51 p.m. Singapore time. The contract slipped 0.4 percent to $93.53 on Dec. 16, the lowest close since Nov. 2. The more-actively traded February future decreased 82 cents to $92.93. Prices are 2 percent higher this year after climbing 15 percent in 2010. Brent oil for February settlement dropped 74 cents to $102.61 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract’s premium to West Texas Intermediate for the same month was at $9.71, after closing at $9.60 on Dec. 16 and compared with a record $27.88 on Oct. 14. Ichimoku Cloud Kim Jong Il, the second-generation North Korean dictator who defied global condemnation to build nuclear weapons while his people starved, died on Dec. 17 of exhaustion, state media reported today. A government statement called on North Koreans to “loyally follow� his son, Kim Jong Un. South Korea’s won declined as much as 1.6 percent to a two-month low of 1,177.15 per dollar, government bonds dropped and the Kospi index lost 4.2 percent to 1,762.34 as of 12:38 p.m. in Seoul. Oil in New York has technical support around $92.80 a barrel, the lower of two so-called leading-span lines that define an “ichimoku cloud� on the weekly technical chart, according to data compiled by Bloomberg. The cloud is an area where buy orders tend to be clustered. Futures halted last week’s decline near that level. ‘Demand Picture’ “The demand picture is starting to look weak,� said Jonathan Barratt, a managing director at Commodity Broking Services Pty in Sydney who predicts oil in New York may drop to $90 a barrel. “You are seeing continued news that reinforces a slowdown and that’s weighing on the price of crude.� Euro-area finance ministers will hold a conference call at 3:30 p.m. Brussels time to discuss 200 billion euros ($261 billion) in additional funding through the International Monetary Fund and the mechanics of a so-called fiscal compact that was negotiated at a Dec. 9 European Union summit, according to two people familiar with the planning. OPEC Production The 27 EU member states accounted for 16 percent of global oil consumption in last year, according to BP Plc’s Statistical Review of World Energy. OPEC’s 30 million-barrel-a-day crude-oil production limit may boost prices next year, Goldman Sachs Group Inc. said in a note yesterday. The Organization of Petroleum Exporting Countries is pumping 700,000 barrels a day above the target and will have to cut output as supplies increase from Iraq and Libya, said David Greely, head of energy research at Goldman in New York. OPEC set a new production ceiling for the first time in three years at its Dec. 14 meeting in Vienna. To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Ramsey Al-Rikabi in Singapore at ralrikabi@bloomberg.net To contact the editors responsible for this story: Mike Anderson at manderson34@bloomberg.net; Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net Want to save this for later? Add it to your Queue!

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