Oil prices fall on eurozone, global concerns

New York's main contract, light sweet crude for delivery in April, settled at $102.70 a barrel, down $1.68 from Wednesday's close.

In London, Brent North Sea crude for April slipped 51 cents to $115.43 a barrel.

Worries about potentially weakening oil demand outweighed market concerns about raging fighting in oil-producing Libya between forces loyal to leader Moamer Gadhafi and rebels.

Matt Smith of Summit Energy said the market shifted focus away from unrest in the Arab world "just because of the downgrade of Spain by Moody's."

Rating agency Moody's cut Spain's sovereign rating, renewing concerns that a eurozone debt crisis was spreading from Greece and Ireland to one of the biggest economies in the 17-nation bloc.

A pair of trade balance reports from the world's two largest economies also dented market sentiment. The US trade deficit rose to a seven-month high in January as imports from China surged and oil prices rose, overwhelming a solid gain in exports.

China posted an unexpected trade deficit for February, the first gap in nearly a year as exports dramatically slowed, raising concerns that the main engine of global economic growth was sputtering.

VTB Capital oil analyst Andrey Kryuchenkov said that market sentiment was hit by concern over the global economic outlook.

Kryuchenkov told AFP that oil prices fell on "growth concerns... on the back of China's trade deficit and Moody's downgrade on Spain earlier today."

"A stronger dollar weighed on oil prices with crude suffering from a broader market sell-off despite intensifying fighting in Libya, as output from the North African producer is largely priced in by now," he added.

Libya's crude oil exports have slowed sharply in the past week and are now significantly below the 500,000 barrels a day reported last week, the Paris-based International Energy Agency reported on Thursday.

Traders braced for possible protests in Saudi Arabia Friday. Facebook activists have called for a "Day of Rage" of street protests in the OPEC kingpin.

"The main focus remains on the Middle East crisis, as any potential protests for Friday's 'Day of Rage' in Saudi Arabia could make crude oil prices to surge higher, with Brent possibly retesting the $120 per barrel area," Sucden analyst Myrto Sokou told AFP.

Oil prices have spiked to more than two-year highs in recent days amid escalating violence and supply shortfalls in Libya.