Business

World oil prices hit more than 3 dollars
by Ioana Madalina Tantareanu

World oil prices hit more than 3 dollars on Monday, due to economic troubles in the U.S., which may lead to a weakened energy demand. The contract for September, in New York hit 3.42$ with 72.06$ per barrel, but soared a historic high of 78.77$ on Wednesday due to declining stockpiles of the world's biggest energy consumer. In London, on Monday, the delivery for September hit a 3.58$ price with 71.17$ per barrel. "Oil prices have fallen back from record highs as weak non-farm payrolls and unemployment figures in the US on Friday once again undermined (economic) confidence, which has already been knocked by the subprime mortgage crisis," Sucden analyst Michael Davies said. It is also probable that this oil crisis be induced onto other markets such as the housing market : "There are now many who are concerned that the (US) subprime mess could spread to other markets, and even hurt demand for oil," said Davies, referring to defaults on subprime loans -- made to those with risky credit. Phil Flynn, an analyst at Alaron Trading, also warned that the housing market crisis could lead to a pullback in consumer spending, which accounts for about two-thirds of US output. Oil prices rose by more than 20% during June and July, with China, India and the U.S. as the biggest demanding parts, especially for petrol products in the transport sector. Kuwait, one of the members of OPEC declared on Sunday that these record prices were due to political instability in major oil-production regions, such as the incresing tensions between Iran and the U.S., and due to growth in the world economy.

by Ioana Madalina Tantareanu for PocketNews (http://pocketnews.tv)

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posted by Blog TechSource @ 12:06 PM