Oil Drops, Paring Biggest Gain Since March on Japanese Output

Oil fell in New York, paring its biggest weekly gain since March, as a drop in Japanese industrial output prompted traders to lock in profits from yesterday’s price surge.

Futures slid as much as 1.5 percent after Japanese factory production declined 4 percent in September, almost twice as much as the median estimate of economists surveyed by Bloomberg News. Oil 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.