Crude-oil futures prices fell Friday in line with broader market declines as the International Energy Agency cut its estimates for global oil demand this year.
Light, sweet crude for March delivery settled $1.17, or 1.2%, lower at $98.67 a barrel on the New York Mercantile Exchange, ending the run of three-straight session of gains. Brent crude on the ICE futures exchange fell $1.22 to $117.47 a barrel.
Prices fell as the IEA, which represents major oil-consuming nations, cut its oil-demand growth forecast for 2012 by 0.3 million barrels a day and said the market has enough flexibility to handle the loss of Iranian oil.
The potential for further slow growth in China, and with it slowing oil demand, is contributing to the declines, said Dominick Chirichella, an analyst at the Energy Management Institute.
"We're at a stage where unless there is a really strong indication that there is a big supply interruption, oil is going to have difficulty surging from the current levels," Chirichella said.
The downgrade to the IEA's demand expectations follows a similar move by the Organization of Petroleum Exporting Countries earlier this week. In its monthly oil report published Thursday, OPEC slashed 120,000 barrels a day from its estimate of oil demand growth.
The IEA report took the wind out of an oil market that had risen for most of the week. Thursday, crude futures closed at their highest level in three weeks, briefly topping $100 a barrel, and traders have said still-simmering tensions in Iran are keeping a floor under prices.
Weakening in the euro versus the dollar also pushed down crude Friday. The euro recently traded at $1.3170, down from $1.3291 earlier in the session. Investors fear any delays in the approval of a second bailout for Greece, particularly as euro-zone finance ministers demand fresh proof the country is prepared to enact new austerity measures during increasing opposition in Greece to the cuts.
"Everyone is still concerned about Greece. The equities markets are taking their hits here, and crude is just following along," said Carl Larry, an analyst at Oil Outlooks and Opinions.
A stronger dollar typically pressures crude prices by making oil more expensive in other currencies.
Declines were seen across commodities markets Friday, with oil, corn, copper and other raw materials mostly lower. The Dow Jones Industrial Average also fell.
Front-month March reformulated gasoline blendstock, or RBOB, settled 3.79 cents, or 1.3%, lower at $2.9745 a gallon. March heating oil settled 2.64 cents lower at $3.1821 a gallon.
More information on settlements and highs and lows for futures on Nymex and ICE platforms can be found by searching for the following headlines:
Nymex Light Crude Oil Close
Nymex Harbor RBOB Gasoline Close
Nymex Heating Oil Close
ICE Brent Crude Oil Close
ICE Gas Oil Close
-By Jerry A. DiColo, Dow Jones Newswires; 212-416-2155; jerry.dicolo@dowjones.com