Anticipation of slowing demand from China complements build in inventories to pressure prices again. Oil prices tumbled again Thursday as traders anticipated lower demand from economic powerhouse China on the heels of an unexpectedly large rise in U.S. crude inventories. U.S. light crude for December delivery dropped 74 cents at $51.74 a barrel in early trading on the New York Mercantile Exchange, its lowest price in two weeks, extending the previous day's $2.71 slump. London Brent crude sank 95 cents to $48.50 a barrel after peaking at a new high of $51.95 Wednesday. Light crude reached an all-time high of $55.67 a barrel Monday.
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However, global demand might slow after the Chinese central bank lifted its interest rates for the first time in nine years in an effort to gently cool its red hot economy, Mueller noted.
Oil is nothing if not voilatile. Interesting timing none the less. Be even more interesting to see how far down it goes. |