Crude oil futures in New York fell more than $3 on Monday on concerns U.S. demand of fuel will decrease as the economy slows down.
Crude prices were down $3.52 or 3.33 percent to $102.10 a barrel on the New York Mercantile Exchange by mid-day. Oil futures rose to a record high of $111.80 a barrel on March 17.
Brent crude traded on the London Metal Exchange dropped $3.21 or 3.09 percent to $100.68 a barrel.
A survey made by Bloomberg to economists, forecasts that the National Manufacturing survey (from the Institute for Supply Management) will show the measure dropped to the lowest in almost five years, increasing worries that demand may slow. The monthly measure gives the earliest indication of the health of the manufacturing sector and helps to assess the state of the economy in the United States.
Tension in the Basra oil port in Iraq eased when Shiite cleric Moqdata al-Sadr called his fighters off the street on Sunday. Last Thursday a bomb attack on a major pipeline system in the south of Iraq affected crude's flow to Basra port and oil prices surged above $108.
An Iraqi oil official declared the oil output and exports had been cut by about 100,000 barrels per day, but he said production will be back to normal on Tuesday according to Reuters.
Analysts commented the restart of the crude pipeline in Iraq was a key factor in pushing oil prices down Reuters reported.