LONDON, Jan 23: Oil prices turned lower again on Friday as demand fell due to the global economic slowdown.

New York’s main futures contract, light sweet crude for delivery in March, shed $1.29 to $42.38 a barrel.

Brent North Sea crude for March fell 79 cents to $44.60 on London’s InterContinental Exchange.

Oil prices ended slightly higher on Thursday after the United States -- the biggest energy consuming nation -- announced a sharp increase in its stockpiles, dealers said.

The US Department of Energy said crude inventories jumped 6.1 million barrels last week, far more than analyst expectations for an increase of around two million barrels.

“Volatile swings are likely to continue, with the (oil) market also tracking equities and the dollar,” said VTB Capital analyst Andrey Kryuchenkov.

Oil prices have plummeted from record highs above $147 in July because of a worsening global economic slowdown that has dented demand.

Hopes of a pick-up in demand were not helped Thursday when it was reported that unemployment claims had hit a 26-year high and housing construction fallen to half-century lows in the United States, the world’s biggest energy consumer.

Oil prices had jumped higher Wednesday on hopes that new US President Barack Obama would help pull America out of recession.—AFP