Oil dips to lowest level since October; settles at $76.35
Benchmark crude for December delivery lost 59 cents to settle at $76.35 a barrel on the New York Mercantile Exchange. Prices dipped as low as $75.57 earlier in the day, the cheapest since Oct. 15.
The Associated Press
11/13/2009
NEW YORK — Oil slid Friday to its lowest price in a month as investors started to pay more attention to a yearlong slump in American energy demand.
For most of the year, oil prices surged as investors pumped money into crude contracts to protect themselves from a weakening dollar. Oil was thought of as a safe bet with demand expected to rise next year, and crude prices doubled from March to October.
But as the recession wore on, consumers and businesses continued to use less gasoline, diesel and other petroleum products than a year ago. Refiners struggled.
Energy Information Administration data showed this week that refiners are operating at the lowest levels ever — except for years when hurricanes disrupted operations in the Gulf of Mexico — according to analyst Stephen Schork.
"That was a wake-up call," said Phil Flynn, an analyst with PFGBest. "People are starting to realize that maybe oil isn't the best hedge against inflation."
Benchmark crude for December delivery lost 59 cents to settle at $76.35 a barrel on the New York Mercantile Exchange. Prices dipped as low as $75.57 earlier in the day, the cheapest since Oct. 15.
The EIA also said Friday that natural gas stockpiles continue to be the highest on record. The U.S. crammed another 25 billion cubic feet into storage last week, putting the country's inventory at more than 3.8 trillion cubic feet.
Retail gasoline prices continued a month long slide. But pump prices remain well above what they were last year. A gallon of regular unleaded dropped half a cent to $2.645 a gallon, according to AAA, Wright Express and Oil Price Information Service. That's 16.4 cents more expensive than a month ago and 46.7 cents more expensive than the same time last year.
In other Nymex trading, heating oil fell 2.05 cents to $1.9705 a gallon. Gasoline for December delivery lost 1.22 cents at $1.9283 a gallon. Natural gas for December delivery added 7.7 cents at $4.447 per 1,000 cubic feet.
In London, Brent crude for December delivery gave up 67 cents to $75.35 on the ICE Futures exchange.
Associated Press writers Pablo Gorondi in Budapest, Hungary and Alex Kennedy in Singapore contributed to this report.
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