Oil dropped

Oil dropped as accelerating Chinese inflation bolstered concern that economic stimulus may be curbed. The spread between crude in New York and London narrowed to the least in almost four months.

Futures fell as much as 1.2 percent after the Chinese government said prices rose the most in seven months. The discount of West Texas Intermediate oil traded in New York to London’s Brent shrank after Enterprise Products Partners LP and Enbridge Inc. completed the Seaway pipeline expansion, providing an outlet for record supplies in the central U.S.

The Chinese consumer price index rose 2.5 percent in December from a year earlier, the National Bureau of Statistics said today in Beijing. China, the largest oil-consuming country after the U.S., accounted for 11 percent of global demand in 2011, according to BP Plc’s Statistical Review of World Energy.

Crude oil for February delivery fell to $92.65 a barrel on the New York Mercantile Exchange. Prices settled at $93.82 yesterday, the highest level since Sept. 18.

Brent oil for February settlement declined $1.64, or 1.5 percent, to $110.25 a barrel on the London-based ICE Futures Europe exchange. Volume was 39 percent above the 100-day average. The grade is down 1 percent this week.