Oil little changed after retail sales, Greece deal

Oil prices drop despite brisk start to US holiday shopping and Greece bailout deal

Associated Press

Oil prices fell Tuesday as traders remained unsure whether positive U.S. economic news signals an increase in fuel demand.

Traders weighed news that might have been expected to push oil prices higher. U.S. holiday spending and consumer confidence both rose. And negotiations over the next installment on Greece's bailout proved successful.

However, some analysts warned that it's still not clear that demand for oil is picking up.

Oil prices could get a short-term lift from the Greece deal, said Edward Bell, a commodities analyst at the Economist Intelligence Unit. Indeed, oil rose in overnight trading after the Greek deal was announced, before prices turned negative in morning trading in the U.S. Crude oil was down 31 cents to $87.43 in afternoon trading on the New York Mercantile Exchange.

"The eurozone has not yet escaped its economic woes and there are no clear signs of a recovery in demand, meaning we expect there will be a drag on oil prices going into 2013," Bell said.

At the pump, the national average for a gallon of regular fell a fraction of a penny from Monday's price to $3.419, according to AAA.

Brent crude, which is used to set prices for many international varieties of oil, fell 60 cents to $110.32 a barrel on London's ICE Futures exchange.

In other energy futures trading on the Nymex:

— Wholesale gasoline for December delivery rose 2 cents to $2.75 a gallon.

— Natural gas rose 3 cents to $3.76 per 1,000 cubic feet.

— Heating oil fell 2 cents to $3.03 a gallon.