Oil Prices Climb to New Record High

Oil prices hit all-time highs Wednesday as inventories dropped more than expected. The October contract for crude oil touched $79.20, trading through the old high of $78.80 hit on August 1st. The jump was after the US government reported crude supplies had dropped 7.1 million barrel last week. Analysts were looking for a drop of only 2.7 million, according to Dow Jones. John Person, president of NationalFutures.com, said that the data was a "big shock to the oil market." He later said, "Consumers are still soaking up supplies rather than conserving and this is forcing refineries to increase production." In an effort to lower the price, OPEC decided yesterday to increase the daily production ceiling for oil (full story). Despite the move, oil continues to creep closer to the $80 level, as demand is projected to increase in the next few years. UPDATE: The October contract gained $1.68 (2.2%) to $79.91 on Wednesday, climbing as high as $80.05 intra-day.

Sources: MarketWatch, CNN
Commentary: A 'Total' Shift in the Oil Industry • Forecasts Show Crude Prices Falling Steadily
Stocks/ETFs to watch: OIL, USO

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Comments

[User 70864]

Where are my 42 Stocks?
Rufus Chappell

2007 Sep 13 09:42 AM