Sugar Drops in New York as Crude-Oil Decline Cuts Fuel Demand

By Ron Day

Oct. 15 (Bloomberg) -- Sugar declined in New York for the first time in three sessions on speculation that falling crude- oil prices will trim demand for fuel made from cane.

Oil slid to its lowest price in more than a year after OPEC, the Organization of Petroleum Exporting Countries, lowered its 2009 demand forecast for a second month as the worst financial crisis since the 1930s threatens a global recession. Lower oil prices may reduce demand for ethanol, a fuel additive refined from cane in Brazil, the world's biggest sugar producer.

Raw-sugar futures for March delivery fell 0.32 cent, or 2.7 percent, to 11.39 cents a pound at 8:16 a.m. on ICE Futures U.S. in New York.

To contact the reporter on this story: Ron Day in New York at rday1@bloomberg.net.