VIENNA (AP) - Oil prices slipped to near $71 a barrel Friday as the crude market took a breather from its recent daily gains. But the mood remained bullish as investors eyed signs that the global recession may be easing.
Benchmark crude for July delivery fell $1.60 to $71.08 a barrel by afternoon European time in electronic trading on the New York Mercantile Exchange. On Thursday, it rose $1.35 to settle at $72.68, the highest since October.
Reflecting expectations of continued global economic weakness, the Organization of the Petroleum Exporting Countries forecast Friday that demand for its crude this year would average 28.6 million barrels a day - 2.2 million barrels less than in 2008.
Still there are some signs of a turnaround.
On Thursday, the International Energy Agency said in its monthly survey that global oil demand would fall by 2.9 percent this year, slightly better than its May forecast of a 3 percent fall.
It was the organization's first upward revision to its forecasts in 10 months.
"Oil prices are discounting positive economic growth by around the end of the third quarter," said Christoffer Molke-Leth, head of sales trading for Saxo Capital Markets in Singapore. "If that doesn't happen, prices at this level are overbought."
Prices have more than doubled since March on hopes that the U.S. recession is past its peak.
The Labor Department on Thursday reported that the number of newly laid-off Americans filing for jobless benefits fell last week by 24,000 to 601,000 - better than economists had forecast.
