The price of oil fell Friday to its lowest level of the year on worrisome economic developments in the world's two largest oil-consuming nations.

The prospect of U.S. government spending cuts raised concerns about oil demand in the world's leading economy while China's manufacturing grew at its weakest rate in five months in February.

By late morning in New York, benchmark crude for April delivery was down $1.19 to $90.86 a barrel. Earlier, it hit a low for 2013 of $90.44.

While there have been signs of an improving U.S. economy in recent weeks, attention Friday was focused on the increasing likelihood that about $85 billion in spending cuts could start taking effect later in the day as part of an earlier budget agreement between the White House and Congress.

The International Monetary Fund has predicted that the spending cuts could reduce U.S. growth by some 0.5 percentage points in 2013.

In China, two surveys showed that manufacturing growth slowed last month as demand faltered and factories shut down for the Lunar New Year holiday.

Brent crude, used to price many kinds of oil imported by U.S. refineries, was down 71 cents at $110.67 a barrel on the ICE Futures exchange In London. That's close to Brent's low for the year.

In other energy futures trading on the Nymex:

  • Wholesale gasoline fell 1 cent to $3.10 a gallon.
  • Heating oil lost 2 cents to $2.93 a gallon.
  • Natural gas rose 2 cents to $3.50 per 1,000 cubic feet.