Oil pulls back from six-month high on economic concerns Crude-oil futures declined Thursday, pulling back from a six-month high as worries about the economy in the U.S. and U.K. weighed on prices. Natural-gas futures slumped after data showed U.S. inventories rose more than expected last week. Standard & Poor's cut its outlook on the U.K. economy to negative from stable, in view of the country's swelling debt. In the U.S., government data showed first-time jobless claims fell last week from a week ago, but still stayed above expectations. Crude for July delivery fell $1.87, or 3%, to $60.17 on the New York Mercantile Exchange after closing Wednesday at the highest level since Nov. 10. "With the market as overbought as it currently is, a breather before an important holiday weekend is probably in order," said Michael Fitzpatrick, an analyst at MF Global. "The market will need to digest the Labor Department's report." In energy equities, the Amex Oil Index fell 1.7% to 937. The Amex Natural Gas Index dropped 1.4% to 425. The Philadelphia Oil Service Index retreated 3.3% to 161. In oil exchange-traded funds, the United States Oil Fund fell 2.3% to $33.10. First-time filings for state unemployment benefits fell back in the latest week by 12,000 to 631,000 in the week ended May 16, the Labor Department reported Thursday. Analysts had expected the number to fall close to 600,000. Meanwhile, continuing claims hit a record high of 6.66 million in the week ended May 9. See full story. The move by Standard & Poor's raises the prospect not only of a credit-rating downgrade in Britain but also a lowering of the outlook in the U.S., which has taken a similar path of big spending and quantitative easing to escape the credit-led recession. See full story. The S&P outlook cut came after Federal Reserve officials on Wednesday projected a deeper recession than they had expected three months earlier and a more sluggish recovery over the next two years. In other economic news, the Philadelphia Federal Reserve survey showed that business conditions worsened in the region in May for the eighth straight month, but the decline was slower than at any time since September. Meanwhile, the recession will be less intense in the near term, and there could even be some growth in the second half of the year, the Conference Board said Thursday. See full story. Also in energy trading Thursday, June-reformulated gasoline fell 3.58 cents, or 2%, to $1.7737 a gallon, and June heating oil lost 3.98 cents, or 2.6%, to $1.5013 a gallon. Natural gas Natural gas for June delivery fell 30.1 cents, or 7.6%, to $3.669 per million British thermal units. Inventories increased by 103 billion cubic feet in the week ended May 15, the Energy Information Administration reported. Analysts surveyed by Platts had expected a gain of less than 100 billion cubic feet. At 2,116 billion cubic feet, stocks were 514 billion cubic feet higher than last year at this time and 387 billion cubic feet above the five-year average.

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