Crude oil and gasoline prices once again topped $70 a barrel after the U.S. government’s assurance that the subprime crises will not push economy in the recession.
While trading, light, sweet crude for October delivery mounts $1.26 to $71.09 a barrel on the New York Mercantile Exchange. In London, prices for the October delivery increases 76c to $70.62 a barrel on the ICE Futures exchange.
Amidst the Brent crude prices hick, gasoline prices for the September supply also augmented by 5.82c and settle at $1.9814 a gallon, heating oil prices rose 3.62c to $1.9972 a gallon.
For the last one week, US refineries are feeling extra burden. Meanwhile, Chevron’s Pascagoula, Miss., refinery is operating at about 50% due to damage from a fire last week. It expects to know next week how long it will take for its full production to come back on line.
Due to the damage Chevron has canceled a 550,000-barrel Venezuelan crude shipment, which could further add panic to the US market. Earlier this week, crude oil and gasoline prices dip amid the fear of Hurricane Dean and uncertainty persisted in the credit markets. Many investors worry that a severe credit tightening could crimp growth and, in turn, dampen energy demand.
In the past few days, market has shown a sign of improvement, Commerce Department confirmed that subprime generated volatility has loosen its grip as orders for durable goods surged 5.9% in July and new-home sales rose 2.8% that month. Amidst the improvement in the housing market, market isn’t fully liberated from the crises. Liquidity crunch still prevails in the economy; Hurricane can also damage the industries.
To end the instability, exist in the world, oil producers need immediate extra pumping of crude oil, whereas oil producing group OPEC didn’t budge from its previous stance and will decide about the further production on Sept. 11.
Via: USA-Today
