NEW YORK, Nov. 20 (UPI) -- Crude oil prices continued drifting lower in early Friday trading as demand signals continued to show protracted softening in the energy market.
West Texas Intermediate, the U.S. benchmark price for crude oil, was down 1.5 percent for the January contract to fall below the psychological $40-per-barrel threshold for the second time this week. WTI opened trading in New York at $39.95 per barrel. Brent, still trading for the December contract, edged up about 0.3 percent to start trading at $44.34 per barrel.
Crude oil prices started the week lower on signs the Japanese economy was moving back into recession. Slowing in the Asian economies has put downward pressure on crude oil prices, with Chinese stock woes in midsummer pulling oil lower. Data published Tuesday by the American Petroleum Institute suggested the U.S. economy was taking in some crude oil as measured by the amount held in storage.
In its latest snapshot, API said total U.S. petroleum deliveries, a metric used to gauge demand, was down about 0.3 percent last month when compared with October 2014.
"October brought strong demand for gasoline, but record refinery production actually outstripped demand for all four major petroleum products," said API Chief Economist John Felmy said in a statement.
While a federal report shows output from shale basins in the Lower 48 should start to decline, API said total U.S. crude oil production in October of 9.2 million barrels per day was the highest year-to-date since 1972.
Prices could move lower by midday after Baker Hughes releases its weekly report on rig activity, a proxy for the health of the exploration and production side of the energy sector. The company last week reported 767 rigs in active service in the United States for the week ending Nov. 13, a 70 percent decline from the same week in 2014.