Oil Falls to One-Week Low on U.S. Budget Concern, European Debt

Oil dropped for a third day in New York on signs that U.S. lawmakers won’t agree on cutting the budget deficit and on concern that Europe’s debt crisis will send the region’s economy into a recession.

Futures fell 0.8 percent on speculation that a debt-reduction committee’s inaction will set the stage for $1.2 trillion in automatic cuts. Growth in Germany, Europe’s largest economy, may slow next year, the Bundesbank said today. Saudi Arabian Oil Co. Chief Executive Officer Khalid Al-Falih said the world economy is at risk of a double-dip recession.