Crude oil trades near two-week low

SINGAPORE, Apr 13 (Bloomberg): Oil traded near its lowest in two weeks on signs prices are damaging fuel demand and that political tension in Middle East may abate. Oil dropped as much as 0.6 per cent in London as Libyan rebels said they would accept Turkey's proposal if it includes an agreement for leader Muammar Qaddafi to relinquish power. Yesterday the International Energy Agency said data indicate a "demand slowdown," while the industry-funded American Petroleum Institute reported U.S. crude stockpiles rose 1.19 million barrels to 355.5 million last week. The Energy Department will release its own data later today. "The sentiment shifted from the bullish side mainly due to the growing downside risk to the world economy from high commodity prices," said Gerrit Zambo, a trader at Bayerische Landesbank in Munich. "But I'm not convinced we've seen the highs for the moment. We still see further demand growth, and the danger of unrest spreading to other oil-producing countries." Brent oil for May settlement declined as much as 72 cents to $120.20 a barrel on the London-based ICE Futures Europe exchange, trading for $121.16 as of 11:43 a.m. Yesterday, the contract declined $3.06, or 2.5 per cent, to settle at $120.92, the lowest since April 1. Crude oil for May delivery fell as much as 88 cents to $105.37 a barrel on the New York Mercantile Exchange, and was at $106.40 a barrel. Yesterday, the contract fell $3.67 to $106.25, the lowest close since March 30.