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Oil falls below $80 per barrel on demand concerns

NEW YORK — Oil prices fell for a third day Friday on worries about the global economy and demand for energy products.

The sluggish U.S. economy and Europe’s debt problems continued to dog investors. Moody’s downgraded eight Greek banks, because of the country’s deteriorating economy. The concern is that a Greek default could hurt other nations in Europe and beyond.

After a broad decline Thursday stock markets wavered between small gains and losses, while many commodities — including gold — continued to drop.

“People are just afraid that demand is going to be affected in a negative way and that’s pulling prices back down,” said Tom Bentz, an analyst at BNP Paribas Commodity Futures.

Benchmark oil fell 87 cents to $79.64 per barrel in midday trading, a day after it plunged more than 6 percent. Brent crude, which is used to price many kinds of oil produced overseas, fell 91 cents to $104.58 per barrel.

Earlier this year benchmark oil rose to nearly $114 a barrel, as many investors hoped an improving global economy would create stronger demand for oil. But high unemployment in the U.S. — the world’s biggest oil consumer — and signs of a slowing economy in China — the second largest oil consumer — pulled oil down.

“We’ve kind of hit a brick wall now and it’s going the other way,” Bentz said.

The price of oil still is about 6 percent more than a year ago. Analysts expect it to stay between $75 and $90 per barrel until there is a better picture of what’s ahead for the global economy.

In other energy trading, heating oil fell 3 cents to $2.8237 per gallon, gasoline futures were virtually unchanged at $2.5440 per gallon and natural gas rose 2 cents to $3.723 per 1,000 cubic feet.