Oil Prices Fall on Economy, Supply Concerns

Oil prices retreated Tuesday on concerns about growing supplies of crude in the U.S. and weak retail sales numbers that suggested consumers were spending less because of high energy prices.

Benchmark West Texas Intermediate crude fell $0.66 to $84.15 a barrel in midday trading on the New York Mercantile Exchange after rising as high as $85.98 earlier in the session. In London, Brent crude fell $0.79 to $102.29 a barrel on the ICE Futures exchange.

The Commerce Department said retail sales rose in January, but it was the smallest increase since June and only half what analysts expected. Some experts think consumers may be pulling back on spending as they pay more for essentials like gasoline.

Gas pump prices have been rising steadily since November and have stayed above $3 a gallon across much of the country. The national average for a gallon of regular was $3.124 Tuesday, according to AAA, Wright Express and the Oil Price Information Service. That's almost $0.51 more than a year ago.

U.S. stockpiles of crude oil continue to rise, undercutting the price of benchmark WTI. The Energy department releases its weekly report on petroleum supplies on Wednesday. Analysts expect it to show increases in supplies of both oil and gasoline, according to Platts, the energy information arm of McGraw-Hill Cos. Oil supplies have been growing for weeks at the Cushing, Okla., hub, which is the delivery point for WTI crude.

Energy traders also kept an eye on anti-government protests that continued in Iran and Bahrain after Egypt's president was forced from power last week.