Oil falls on fading US stimulus hopes

Oil prices fell on Friday as hopes dimmed for stimulus measures to re-energise the faltering US economy, analysts said. In late morning London deals, Brent North Sea crude for July sank $1.58 to $98.35 per barrel. New York's main contract, West Texas Intermediate crude for delivery in July dived $2.01 to $82.81 a barrel. "Oil prices have fallen along with equity markets after (US) Federal Reserve chairman Ben Bernanke tempered hopes that there would be more stimulus for the US economy," said Victor Shum, senior principal at Purvin and Gertz international energy consultants in Singapore. Bernanke's failure to signal any new stimulus on the way for the world's biggest economy, in remarks Thursday to a Congressional panel, dragged on equity and oil markets. The United States is the world's top oil consumer. Worries are also mounting over Chinese demand after Beijing announced a cut in interest rates on Thursday to boost the world's second largest economy and biggest energy consumer. "The interest rate cut by China is also weighing on the market. It is being seen as a sign that the May economic data that will be released soon are quite weak," he added. Monetary easing had been expected in China following dismal economic figures in April and weak manufacturing numbers in May.