Last week a rogue trader caused the price of oil to spike up to $73.00 per barrel. Last week also we had some bleak news hit the tape. The jobs market got worse with 467,000 jobs lost. Wages are dropping due to shortened work weeks and factory shut downs. Unemployment rose to 9.5%. Consumer confidence also fell.
Now all of this is finally penetrating the minds of investors. The stock market is selling off and now the word has gotten to the oil traders who are selling oil and oil products in the commodities markets. Crude oil for August delivery fell to $63.76 per barrel. Gasoline for August delivery fell 5.83 cents to $1.7325 per gallon and heating oil dropped 6.62 cents to $1.6354 per gallon. Natural gas slid 15.7 cents to $3.158 per 1000 cubic feet.
In London, Brent crude fell $1.72 to $63.98 per barrel.
In other markets the dollar rose against other major currencies with the euro trading at $1.3905, but the British Pound fell $1.611
If we look forward to the second half, the prospects of an early recovery still remain out of reach. It may not even come this year. The mood is changing ever so slightly. Investors are showing signs of caution both in the stock market and in the oil market which tends to be a barometer of economic progress.
Do you believe that oil will drop below $50.00 per barrel?
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