Some good news out of the bad News for US!

Oil plunges to 13-month low on global slowdown

Oct 10 02:44 PM US/Eastern
By STEVENSON JACOBS
AP Business Writer

NEW YORK (AP) - Oil prices plunged in another violent sell-off Friday, briefly tumbling below $78 a barrel as investors grow more pessimistic about the prospects for resolving a mushrooming global economic crisis.

A barrel of oil hasn't been this cheap in 13 months.

The steep losses came as Wall Street extended its staggering decline for an eighth straight day and headed for its worst weekly drop ever. The Dow Jones industrial average was down more than 500 points in mid-afternoon trading.

"Oil is mirroring the stock market right now. There's a total lack of confidence. It's fear driving more fear," said Phil Flynn, energy analyst at Alaron Trading Corp. in Chicago.

Light, sweet crude for November delivery fell $8.01 to $78.61 a barrel on the New York Mercantile Exchange, after earlier falling to $77.28, its lowest level since Sept. 11, 2007.

Crude has now lost about 47 percent since hitting a record $147.27 on July 11, tumbling as a deepening credit crisis caused by the subprime mortgage fiasco wreaks havoc around the globe and drives down energy demand.

Investors have shrugged off an array of market-stabilizing efforts by world governments, including a $700 billion U.S. financial rescue plan, several bank bailouts and a coordinated interest rate cut by the Federal Reserve and central banks around the globe.

Underscoring Americans' waning appetite for fuel, a gallon of regular gasoline dropped 5.3 cents overnight to a new national average of $3.35 a gallon, according to auto club AAA, the Oil Price Information Service and Wright Express.

Prices dipped below $3 a gallon on average in Kansas, Missouri and Oklahoma. If crude keeps falling, the rest of country should see sub-$3 gasoline in the next few weeks if not sooner, experts say.

Oil market traders were also fixated on signs of falling energy demand around the globe.

The International Energy Agency on Friday cut its global oil demand forecasts for this year and 2009, pointing to the worsening economic conditions and the tight credit supply.

The Paris-based energy watchdog cut its forecast for oil demand this year by 240,000 barrels per day, and slashed its 2009 forecast by 440,000 barrels per day. The IEA now expects global oil demand to total 86.5 million barrels per day this year and 87.2 million barrels per day next year.

"The fundamental game for oil has changed. In the last decade, oil went up because of strong global economic growth. That story for the near term is over, so everybody has to re-evaluate," Flynn said.

Crude's steep losses came despite signs that the Organization of the Petroleum Exporting Countries may tighten output to put a floor under falling prices.

OPEC said Thursday it will hold a special meeting Nov. 18 to discuss how the economic crisis is affecting oil prices, while the head of Libya's national oil company, Shukri Ghanem, called on oil producing nations to cut output.

But analysts doubt an OPEC cut would reverse the extreme downward momentum on oil. OPEC's decision last month to cut production by 520,000 barrels a day failed to halt the losses.

Flynn said another output cut "may actually accelerate the slide."

"What's driving this market right now is fear of demand destruction and lack of credit," he said. "If you can't borrow money to buy crude, then demand falls more and so do prices."

In other Nymex trading, heating oil futures fell 22.06 cents to $2.198 a gallon, while gasoline prices dropped 22.26 cents to $1.8047 a gallon. Natural gas for November delivery fell 26 cents to $6.565 per 1,000 cubic feet.

In London, November Brent crude fell $8.39 to $74.27 a barrel on the ICE Futures exchange.

It got down to 2.89 around here. Still is.

Gas prices in my area just hit $2.99 per gallon today! At least it makes it easier on us all pocketbook wise. I remember, not many months ago, that OPEC said oil should be at 60 to $70 per barrel, and that the price was artificially inflated due to the stock market.

I agree we still need to pursue alt. sources of energy NOW, but with the winter coming, lower prices in gasoline, natural gas and oil will help in out travel to work and the heating of our homes!

The market is adjusting naturally, just as it needs to do. As time goes on, stocks will be seen as good deals, and people's retirement accounts will go up again.

After seeing how AIG is taking advantage of the government loans, It makes me more and more mad that we are helping greedy thieves while they go on high cost "vacation" business meetings! If they were that bad of a company, I hope some executives go to jail for ripping us off.

Gas is only $3.49 here!!! Less than $3.50

I was shocked to see it 3.09 yesterday morning and even more shocked to see it 2.99 less than 10 hours later

Sorry



I won't cheer for 2:99 a gallon gas

When it hits 1:50


Then I will cheer

$1.50/gal is where I came in (to Michigan) in September 2002.

Wait until them camel jockeys at OPEC raise the price of oil

I want off this merry-go-round! Maybe I should become Amish.

Amish use natural gas for the house and gasoline for some washing machine motors. I live close to them and want to move to Wooster OH area, in Amish area. I would have no problem becoming Mennonite. No way could I go Old Order Amish! But I buy their organic products!

GoGetEmTigers wrote:

Amish use natural gas for the house and gasoline for some washing machine motors. I live close to them and want to move to Wooster OH area, in Amish area. I would have no problem becoming Mennonite. No way could I go Old Order Amish! But I buy their organic products!

Mennonite?

Mennonite are a more liberal form of Amish. They accept modern stuff, but are still a very holy group.

See Who are the Mennonites

Thanks

The only thing that angers me about the Lancaster, PA bunch is they are doing puppy mills for extra income. Many do not really take care of the dogs and do not seek veterinary care.

laprimamirala wrote:

The only thing that angers me about the Lancaster, PA bunch is they are doing puppy mills for extra income. Many do not really take care of the dogs and do not seek veterinary care.

Shame on them

laprimamirala wrote:

The only thing that angers me about the Lancaster, PA bunch is they are doing puppy mills for extra income. Many do not really take care of the dogs and do not seek veterinary care.

True, but many of those puppy mills are not Amish owned, it is secular people living there.

They do not have that problem with the Holmes Co. OH (and surrounding area) Amish.

That's good news, anyway. I couldn't be one anyway...they aren't vegetarian!

laprimamirala wrote:

That's good news, anyway. I couldn't be one anyway...they aren't vegetarian!

Some are. It is a very diverse area.

Maybe a very FEW are...