Oil hovers below $105 as US, China growth slows

Oil prices hovered below $105 a barrel Monday in Asia amid the prospect that slowing economic growth in the U.S. and China will undermine demand for crude.

Benchmark oil for June delivery was up 2 cents to $104.95 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 38 cents to settle at $104.93 in New York on Friday.

Brent crude for June delivery was down 36 cents at $119.47 per barrel in London.

The Commerce Department said Friday that the U.S. economy grew at an annual rate of 2.2 percent in the January-March quarter, compared with 3 percent in the final quarter of 2011. Earlier this month, China reported its gross domestic product growth slowed to 8.1 percent in the first quarter.

Crude jumped from $75 in October to $110 last month as better than expected U.S. economic activity and strong demand from developing countries such as China bolstered investor confidence.

"The disappointing GDP data continued a trend of recent weeks in which economic releases have been tilting toward the bearish side," energy trader and consultant Ritterbusch and Associates said in a report. "This has conjured up images of further petroleum demand slippage especially when combined with slowed growth indications out of China."

Trading volume was low as markets in Japan and China were closed Monday for national holidays. Markets in China, Hong Kong, India, Singapore and Taiwan will be closed Tuesday for the Labor Day holiday.

In other energy trading, heating oil was down 0.1 cent at $3.18 per gallon and gasoline futures fell 0.2 cents at $3.14 per gallon. Natural gas slid 0.2 cents at $2.18 per 1,000 cubic feet.