Science/Environment

Oil Down To $88 A Barrel

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As purse strings tighten and consumption plummets, the market runs screaming.

Reuters has more…

Oil dropped $6 to below $88 a barrel on Monday on expectations the growing financial crisis will further slow already faltering global fuel demand.

Crude prices have plummeted from a peak over $147 a barrel set on July 11 as high fuel prices and the growing financial crisis slow oil demand in top consumer the United States and other industrialized nations.

“The prevailing macro sentiment is now crystallizing around the notion that we are heading into a synchronized global slowdown, a mirror image of the across-the-board expansion we saw from 2004 to early 2007,” said Edward Meir of broker MF Global.

A silver lining to this crisis or will Americans simply see cheaper gas prices and start consuming more?

I hope it’s the former, but I fear the latter is much likelier.

  • http://www.warning1938alert.ytmnd.com Jimmy the Dhimmi

    A silver lining to this crisis or will Americans simply see cheaper gas prices and start consuming more?

    I hope it’s the former, but I fear the latter is much likelier.

    If Americans simply see cheaper gas prices and start consuming more, that would be the silver lining, No?

  • http://www.donklephant.com Justin Gardner

    Well, no. Hopefully they’ll keep their consumption lower and start moderating their behavior so they’ll save more money and keep gas prices lower.

  • http://whoswrongtoday.blogspot.com Mike

    Wait, I thought supply and demand weren’t responsible for the price of oil? I thought it was just a bunch of rich, cigar smoking oil executives who set the price. Thanks for clearing that up. I was thinking maybe they were just starting to feel to holiday spirit a little early.

    (Sorry for the blatant sarcasm. No bad will intended, but you have to admit it’s suspicious how people frame the oil debate in the way that benefits their position: when prices are high, oil executives are to blame. When prices are low, it’s because the economy is poor).