Nov. 22 (Bloomberg) -- Oil traded near $97 a barrel in New York after falling from a record yesterday amid signs of slowing demand growth in the U.S., the world's largest energy consumer.

Crude declined as U.S. equities fell to a three-month low on concern mortgage defaults will spread through the economy of the world's largest oil user. Crude-oil inventories at the delivery point for the U.S. benchmark grade increased.

``There are those who were keen on buying crude oil based on optimism for the world economy,'' said Hirofumi Kawachi, senior energy analyst at Mizuho Investors Securities in Tokyo. ``But the situation has changed and more people are talking about a recession.''

Crude oil for January delivery was at $97.41 a barrel, up 12 cents, in after-hours electronic trading on the New York Mercantile Exchange at 1:11 p.m. in Singapore.

The contract fell as low as $96.31 yesterday before closing down 0.8 percent at $97.29. The futures earlier reached $99.29, the highest intraday price since trading began in 1983.

The S&P 500, which measures the performance of the largest 500 U.S. companies, dropped 1.6 percent, to 1,416.77 yesterday, leaving it with a 0.1 percent loss on the year. Japan's Topix index, the broadest gauge of equity prices in the world's second-largest economy, yesterday became the first of the world's 10 biggest stock markets to enter a bear market.

``There's going to be a recession here in the U.S. before too long,'' said Bob Frye, commodity broker at Access Futures & options Trading Co. in Woodlake, California. ``I don't see any way around it.''

Brent, Stockpiles

Brent crude oil for January settlement was at $95.17 a barrel, up 33 cents, on the London-based ICE Futures Europe exchange at 1:10 p.m. Singapore time. The contract fell 65 cents, or 0.7 percent, to close at $94.84 yesterday. It earlier reached $96.53, the highest since trading began in 1988.

Yesterday's oil price slide slowed after an Energy Department report showed U.S. oil stockpiles fell 1.07 million barrels last week to 313.6 million. A 750,000 barrel-increase was expected, based on a Bloomberg News survey of 16 analysts.

Supplies at Cushing, Oklahoma, where New York-traded West Texas Intermediate oil is stored, rose 1.14 million barrels to 14.6 million last week, the Energy Department report showed. Nationwide, stockpiles of crude oil fell 1.07 million barrels to 313.6 million, said the report.

New York floor trading is shut for today's Thanksgiving holiday in the U.S. and all electronic trades will be booked to the Nov. 23 session.

Daily volume in oil futures fell to a four-month low this week and the holiday was probably the biggest influence on yesterday's trading, Access's Frye said.

The dollar touched $1.4872 per euro yesterday, the lowest since the 13-nation currency was started in 1999, after a report showed U.S. consumer confidence reached a two-year low last month. The Conference Board's index of leading economic indicators fell 0.5 percent, more than forecast, suggesting the U.S. economy will continue to slow into 2008.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.netGavin Evans in Wellington at gavinevans@bloomberg.net.

Last Updated: November 22, 2007 00:21 EST