Summary: Rising supplies and a (thankful) lack of hurricanes in the Gulf of Mexico are contributing to oil’s continued slide. Oil prices are down 25% from July’s peak ($78.40/barrel), and have already fallen about 7% this week, dropping 3.9% yesterday to close at $58.20/ barrel. Analysts believe that last week’s U.S. stockpiles of distillate and gasoline rose 1.5mm and 1.6mm barrels, respectively. Additionally, the Energy Department said that for the week ending September 22, supplies of crude, gasoline, heating oil and diesel were above their five year seasonal averages. On the hurricane front, despite earlier predictions of an active hurricane season, there were no such storms this year – the first time in the past five years. Analysts are now watching to see if any further declines will trigger OPEC production cuts.
Related links: Full article • Discussions on Oil • Inflated Oil Prices: Your Tax Dollars at Work • Debunking the Bear Case for Energy • OPEC Keeping Its Eye on Prices • Oil Price Falls Below $60 • OPEC's Dilemma: When and How to Cut Production
Potentially impacted stocks and ETFs: U.S. Oil Fund ETF (NYSEARCA:USO)
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