NYMEX crude oil contract closed down $1.46

The Oct NYMEX crude oil contract closed down $1.46 at $107.89, despite the US Energy Dept weekly report showing a drop in crude reserves and gasoline. But demand is forecast to keep falling, so even a arose-than-expected outcome is okay. Bloomberg reports that the “daily average implied fuel demand so far this year is down 4.1% at 19.9 million barrels from a year ago.” Oil industry analysts call this “demand destruction.”

So far today, oil is down to $106.37 at 11:22 am GMT, which puts it down 27% from the July 11 record high at $147.27. No wonder funds are pulling out. We would like to hear what Jimmy Rogers is saying today. Earlier in the price drop, he said “it will come back.”

To throw a little cold water on the oil forecast, Hurricanes Hannah and Ike are closing on the US to make three in one week, for the first time since 2005 when Katrina ruined New Orleans.

Bye For Now

Barbara Rockefeller