Crude oil plummets to below $100/barrel
16 September 2008
1,973 views
1187 Comments
The price of crude oil dropped below $100-a-barrel yesterday (its lowest level since February) as the slowing economy — bringing with it a reduced demand for oil — raised concerns. Interestingly enough, the drop in crude didn’t affect the price of gasoline as it rose 16 cents per gallon due to refinery closures from Hurricane Ike. The storm only caused moderate damage to oil platforms, but more than a dozen Texas and Louisiana refineries were shut down or idled ahead of the storm. It was just July when crude oil prices peaked at just over $145 per barrel, and gas prices neared $5 in many parts of the country. The high cost of fuel over the summer stymied drivers, who cut back on consumption forcing the price of oil to slowly retreat. Analysts who predicted doom ($200-a-barrel by the end of the year) are now scaling back their forecasts, and some have even predicted crude may eventually drop to $70-a-barrel. While we obviously welcome any drop in the price of crude, it’s the volatility — the sharp fluctuations as a result of market conditions — that we would also like to see addressed.
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