Oil falls near 13-month low on global slowdown
The Associated Press
NEW YORK — Oil prices briefly plunged below $79 a barrel Friday, dropping to the lowest level in nearly 13 months as investors grow more pessimistic about the prospects for resolving a mushrooming global economic crisis.
Light, sweet crude for November delivery fell as much as $7.96 to $78.66 a barrel on the New York Mercantile Exchange, plummeting after the Dow Jones industrials fell nearly 700 points shortly after trading began. It was the lowest trading level for a front month crude contract since Sept. 26, 2007.
“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.
Oil prices pared some their losses after the Dow regained some ground, falling $5.91 to $80.71 a barrel in late morning trading.
Crude has now lost about 45 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.
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.
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This article was published Friday, October 10, 2008.
