Oil Prices Drop Below $130 Per Barrel
Posted on: Saturday, 19 July 2008, 00:00 CDT
By The Associated Press
NEW YORK (AP) - Oil prices fell below $130 per barrel for the first time in more than a month Thursday, as a dramatic slide entered a third day along with a sharp sell-off in natural gas.The declines accelerated amid growing concerns about the weakening U.S. economy."The entire bullish scenario ... is starting to crack," said James Cordier, president of Tampa, Fla.-based trading firms Liberty Trading Group and OptionSellers.com.Light, sweet crude for August delivery dropped $5.31 to settle at $129.29 per barrel on the New York Mercantile Exchange. Prices have fallen more than $15 in just the past three days.Natural gas futures for August delivery fell more than 8 percent Thursday, marking their biggest one-day drop in nearly a year, according to Nathan Golz, researcher at Wachovia Securities in St. Louis. Prices for the key heating, cooking and power generation fuel have tumbled more than 20 percent since their peak before the Fourth of July and are now trading at their lowest point since April.A number of market observers say there was nothing supporting the run up in natural gas prices, which peaked in early July, and that this week's sell-off of oil has only helped speed the declines."Any time oil goes up or down on Nymex, it's going to have a carry-over effect on natural gas," said Michael Rieke, senior managing editor for power and gas at energy research firm Platts.The immediate cause of Thursday's sharp natural gas decline was a larger- than-expected buildup of U.S. supplies.The Energy Department's Energy Information Administration said in its weekly report that natural gas inventories held in underground storage in the lower 48 states rose by 104 billion cubic feet to more than 2.31 trillion last week.
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Source: Telegraph - Herald (Dubuque)
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