This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7595293.stm
The article has changed 7 times. There is an RSS feed of changes available.
| Version 2 | Version 3 |
|---|---|
| Crude oil price drops below $109 | Crude oil price drops below $109 |
| (about 6 hours later) | |
| Oil prices have dipped to $108 after Hurricane Gustav did not significantly disrupt output, and on concerns that slowing world growth will dent demand. | |
| New York light, sweet crude fell 1.71 cents, or 1.6%, to $108 a barrel, with Brent crude down $1.09 at $107.25. | |
| Prices have fallen from their record of more than $147 a barrel in July amid evidence that some of the world's main markets may be heading for a recession. | Prices have fallen from their record of more than $147 a barrel in July amid evidence that some of the world's main markets may be heading for a recession. |
| At the same time, a number of political and currency risks have also subsided. | At the same time, a number of political and currency risks have also subsided. |
| "Had it not been for the hurricane, we would have seen a lower price profile over the last week," said David Moore of Commonwealth Bank of Australia. | "Had it not been for the hurricane, we would have seen a lower price profile over the last week," said David Moore of Commonwealth Bank of Australia. |
| Oil prices have dropped more than $6 a barrel since Friday, and touched their lowest level in five months on Wednesday. | Oil prices have dropped more than $6 a barrel since Friday, and touched their lowest level in five months on Wednesday. |
| 'Demand destruction' | 'Demand destruction' |
| As the threat of Hurricane Gustav has diminished, many of the investors who have been pushing the price of oil higher have now focused on the global economic environment. | As the threat of Hurricane Gustav has diminished, many of the investors who have been pushing the price of oil higher have now focused on the global economic environment. |
| "As the reality of this storm is now becoming clear, energy bulls are on the run and the market is finally facing up to the realities surrounding it," said Phil Flynn of Alaron Trading. | "As the reality of this storm is now becoming clear, energy bulls are on the run and the market is finally facing up to the realities surrounding it," said Phil Flynn of Alaron Trading. |
| On Tuesday, the Organisation for Economic Cooperation and Development warned that the UK was heading for a recession this year. | On Tuesday, the Organisation for Economic Cooperation and Development warned that the UK was heading for a recession this year. |
| The high price of oil has pushed up the cost of petrol | The high price of oil has pushed up the cost of petrol |
| In the US, concerns still remain that the world's largest economy oil consumer, is facing rocky times. | In the US, concerns still remain that the world's largest economy oil consumer, is facing rocky times. |
| With economic growth slowing, and many people worried about their job prospects, there is a good chance that consumer spending will slow, limiting demand for crude oil. | With economic growth slowing, and many people worried about their job prospects, there is a good chance that consumer spending will slow, limiting demand for crude oil. |
| "It's the economy, economy, economy. Everyone's worried about demand destruction," said Robert Nunan of Mitsubishi Corp. | "It's the economy, economy, economy. Everyone's worried about demand destruction," said Robert Nunan of Mitsubishi Corp. |
| On Tuesday, the US said it was releasing 250,000 barrels from its emergency supplies in an attempt to ease market concerns and provide liquidity to the market. | On Tuesday, the US said it was releasing 250,000 barrels from its emergency supplies in an attempt to ease market concerns and provide liquidity to the market. |
| "The release of the oil will prevent any shortage and that will, of course, help calm the market," said Victor Shum of Purvin & Gertz. | "The release of the oil will prevent any shortage and that will, of course, help calm the market," said Victor Shum of Purvin & Gertz. |
| Another factor helping push down the price of crude was a gain in the value of the US dollar, which rose to an 11-month high against a basket of major currencies on Wednesday. | Another factor helping push down the price of crude was a gain in the value of the US dollar, which rose to an 11-month high against a basket of major currencies on Wednesday. |
| The weakness of the dollar has been a main driver of high oil prices as investors looked to offset a drop in the US currency by buying other assets such as crude. | The weakness of the dollar has been a main driver of high oil prices as investors looked to offset a drop in the US currency by buying other assets such as crude. |
| Volatile times | Volatile times |
| However, while the price of oil may be falling, analysts are keen to point out that markets remain volatile. | However, while the price of oil may be falling, analysts are keen to point out that markets remain volatile. |
| Earlier this year a number of well respected Wall Street firms and analysts predicted that oil could climb as high as $250 a barrel. | Earlier this year a number of well respected Wall Street firms and analysts predicted that oil could climb as high as $250 a barrel. |
| In the meantime, however, the drop in oil prices will bring some relief to consumers and governments who have been faced with accelerating price growth and more expensive fuel. | In the meantime, however, the drop in oil prices will bring some relief to consumers and governments who have been faced with accelerating price growth and more expensive fuel. |