Oil Drops on Japan Output, Pares Biggest Weekly Gain Since March

Oil fell in New York, paring its biggest weekly gain since March, as a drop in Japanese industrial output countered bets that U.S. economic growth and a deal to tame Europe’s debt crisis will boost fuel demand.

Futures slid as much as 1 percent after Japanese factory production declined 4 percent in September from the previous month, almost twice as much as the median estimate from economists surveyed by Bloomberg News. Prices rallied yesterday after data showed the U.S. economy grew in the third quarter at the fastest pace in a year and European leaders agreed on a plan to curb the region’s debt crisis.