Crude Oil Falls on Signs of Lower Fuel Demand, Rising Dollar (Bloomberg)

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Aug. 19 (Bloomberg) -- Crude oil fell a fourth day on signs of declining demand in the U.S., the biggest energy-consuming country, and as the dollar strengthened.

U.S. fuel use has dropped this year as the economy slowed, according to industry data. The euro traded near its weakest against the dollar in six months, prompting investors to sell commodities. Prices also dropped as Tropical Storm Fay hit Florida, missing U.S. oil fields in the Gulf of Mexico.

{xtypo_quote_left} The Labor Department reported that prices paid to U.S. producers in July rose double the amount that economists had projected. Higher inflation may lead the Federal Reserve to boost interest rates, sending the dollar higher and commodities lower. {/xtypo_quote_left}

"The continuing weak demand outlook should keep prices moving lower,'' said Rick Mueller, director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. ``Demand in the U.S. looks awful and Europe is weakening as well. A strong storm heading for the Gulf of Mexico, not Fay, would give prices a boost."

Crude oil for September delivery fell 66 cents, or 0.6 percent, to $112.21 a barrel at 9:53 a.m. on the New York Mercantile Exchange. Futures touched a 15-week low of $111.34 a barrel on Aug. 15. Prices are up 56 percent from a year ago.