NEW YORK-Oil prices fell yes­ter­day as neg­a­tive US eco­nom­ic news trumped a re­port show­ing a de­cline in the na­tion's oil and gaso­line sup­plies. Bench­mark crude dropped 49 cents in mid­day trad­ing Wednes­day to $82.83. Brent crude, which is used to price in­ter­na­tion­al oil and to make gaso­line in much of the Unit­ed States slipped 25 cents to US$96.72.

The Com­merce De­part­ment said yes­ter­day that re­tail spend­ing slipped 0.2 per cent in May, fol­low­ing an iden­ti­cal de­cline in April. That's a sign con­sumers are pulling back, which could in turn lead to low­er con­sump­tion of gaso­line and crude oil. Mean­while, the En­er­gy De­part­ment said crude in­ven­to­ries fell by 200,000 bar­rels last week, though they re­main rel­a­tive­ly high for this time of year.

Gaso­line sup­plies fell 1.7 mil­lion bar­rels, how­ev­er, leav­ing stocks slight­ly be­low av­er­age. An­a­lysts had ex­pect­ed an in­crease in gas sup­plies. The de­cline was sur­pris­ing be­cause US gaso­line de­mand has been weak. It was a large drop in spend­ing at the pump that dragged down over­all re­tail sales in May, the Com­merce De­part­ment said.

AP