Oil prices drop below US$125

Crude futures settled below 125 US dollars a barrel on Wednesday for the first time since June 5.

A gas price sign is shown in McKinney, Texas, Friday, July 18, 2008. Prices at the pump backed away from record highs as oil futures edged up Friday, but crude's gains were modest in comparison to the spectacular three-day  drop earlier in the week. The political vision of a summer gas tax holiday died a quick death in Congress, losing to a view that federal excise taxes on gasoline and diesel fuel will have to go up if they go anywhere. (AP Photo)

This came as the weak demand reflected in the more-than-expected increase in US fuel stockpiles.

Light, sweet crude for September delivery dropped 3.98 dollars to settle at 124.44 dollars a barrel on the New York Mercantile Exchange. Futures touched 124.30 dollars a barrel, setting the lowest intraday trading price in seven weeks.