Crude Oil Prices Continue to Slide
07/17/08 - 02:50 PM EDT
Chuck Marvin
Crude oil and natural gas futures were under heavy selling pressure Thursday, the former driven by a continuing downtrend and the latter by a surprisingly large build in weekly storage levels.
Texas light sweet crude for August delivery was recently down $3.85 at $130.75 a barrel, and Brent crude was losing $3.59 at $132.22 a barrel. Reformulated gasoline was losing 9 cents to $3.19 a gallon, and heating oil was off 6 cents at $3.78 a gallon. Near-term natural gas was down 89 cents at $10.51 per million British thermal units -- a nearly three-month low -- after the Energy Information Administration revealed that total U.S. stockpiles grew by 104 billion cubic feet during the week ended July 11. Analysts were expecting an 88 BCF increase, according to a survey conducted by Bloomberg. Total natural gas in storage now lies at 2.312 trillion cubic feet, just shy of its 5-year average of 2.361 trillion cubic feet. Crude oil entered the Nymex session severely bruised and battered after August WTI lost 8% in the prior two trading days. A generally sour outlook for the U.S. economy and signs of falling demand have nudged the oil market into what could be its weakest state since its three-month stall in the fourth quarter. Demand deterioration for crude and its derivative products has the energy markets thoroughly spooked. The Energy Information Administration reported on Wednesday that U.S. motor gasoline consumption over the past four weeks was 2.2% lower than the same period last year.
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