WTI falls below $116 per barrel

Oil prices slightly higher in light tradeCrude oil prices fell significantly Friday as the US dollar gained strength and as investors worried about falling demand.

The situation surrounding a pipeline explosion and fire in Turkey, attributed to sabotage, seems not to have had a lasting impact on prices even though BP (LSE: BP; NYSE: BP; TYO: 5051) and other companies which receive oil through the pipeline have declared force majeure, releasing them from fulfilling contractual obligations to deliver oil due to events out of their control.

A military dispute between Georgia and a break-away province being supported by Russia also had little effect on prices.

September contracts for West Texas Intermediate crude were $4.72 lower just before the close of floor trade on the New York Mercantile Exchange to $115.30 per barrel while Brent crude was down $3.60 to $112.26 per barrel on the ICE Futures Europe exchange in London.

In afternoon trade, Nymex September gasoline had fallen 8 cents to $2.92 per gallon while September heating oil was also down 8 cents, to $3.15 per gallon, and September natural gas had dropped 25 cents to $8.32 per million British thermal units.

At-the-pump prices in the United States were down another cent overnight, to a national average of $3.836 per gallon and there are predictions that pump prices could be as low as $3.50 per gallon on average by Labor Day in the US, which will be celebrated on 1 September this year and marks the end of the summer driving season.

You May Also Like