LONDON - Oil prices fell on Friday, hit by profit-taking and weaker stock markets, dealers said, although the losses were limited by upbeat economic data in the United States. London’s Brent North Sea crude for November delivery dropped 72 cents to 70.83 dollars per barrel in early morning deals. New York’s main contract, light sweet crude for October delivery, dipped 69 cents to 71.78 dollars a barrel. Crude futures had fallen modestly on Thursday as the market consolidated hefty gains that were fuelled by a weak dollar, strong equity markets, global recovery hopes and falling US crude inventories. ‘We had three solid days of gains on equities and commodities markets so there’s a little bit of profit-taking,’ said Ben Westmore, a minerals and energy economist with the National Australia Bank in Melbourne. Sentiment in the oil market was also weighed down by a fall in global stocks after a rally on Wall Street ran out of steam on Thursday. Shares in Asia and Europe followed the New York lead on Friday after three days of gains. Westmore said however that better-than-expected economic data from the United States limited the fall in oil prices on hopes that energy demand will soon pick up in the world’s largest economy and energy consumer. The US Labor Department reported Thursday that new jobless claims fell 12,000 to 545,000 in the week ending September 12. The data was better than market expectations of 557,000. Adding to the recovery hopes was the Philadelphia Federal Reserve Bank which said its business activity index for September hit a two-year high. Other figures showed home construction and building permits rose in August. The news followed a surprise drop in crude inventories in the United States, supporting the growing perception that recovery was under way. The US Department of Energy said Wednesday that the country’s crude stocks dropped by 4.7 million barrels in the week to September 11, beating analysts’ forecast for an average decline of 2.5 million barrels. The sharper than expected drop was seen as an indication that US oil demand was improving but some analysts cautioned that stockpiles remained huge and prices had not touched June highs. Oil won strong support this week from the struggling dollar, which languished near one-year lows against the euro on Thursday as investors moved away from the safe-haven greenback to more risky investments. A struggling greenback tends to boost crude prices because dollar-priced oil becomes cheaper for buyers with stronger currencies, thereby stimulating demand for the commodity. The global economic downturn had sapped demand for energy, dragging crude prices from record highs of above 147 dollars in July 2008 to 32.40 dollars in December. They have since won back some ground to hover around 70 dollars on hopes of worldwide economic recovery.

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