Post-Holiday Price Drop as Fireworks Fade
Crude, gas prices ease off as Iraq, hurricane threats moderate
NEW YORK -- As of July 7, the price for U.S. benchmark West Texas Intermediate (WTI) crude fell for the seventh day, Bloomberg reported, in what the news agency said is the greatest run of price drops since Dec. 2009.
On the New York Mercantile Exchange (NYMEX), WTI prices for August delivery dropped 0.7% or 76 cents to rest at $103.30 the morning of July 7, and even flirted with $103.25, which is the lowest level since June 9. This seven-day decline is reportedly the longest drop in prices since Dec. 2009, when WTI fell over nine days.
Meanwhile, Brent crude, the global benchmark, reached a three-week low thanks to Libya's plans to increase exports, helping moderate the impact of tensions in Iraq on oil prices.
"The Libya situation has added to the downward pressure on the market," John Kilduff, partner at New York-based energy hedge fund Again Capital LLC, told Bloomberg. "We've given back all of the Iraq security-fear gains that were added in June."
The Brent price dropped 48 cents to reach $110.16 a barrel on the ICE Futures Europe exchange, touching $110.09, which is the lowest intraday price since June 12, Bloomberg reported. It traded at a $7.05 premium to WTI, up from $6.94 on July 3.
Meanwhile, gasoline prices dropped up to 0.8% as Hurricane Arthur moved up the East Coast over the July 4th holiday, which dented fuel demand. Fortunately, despite some flooding and power outages, most of the coast avoided the worst of the storm.
"The worst-case scenarios didn't happen over the holiday weekend, so there's a bit of relief," Phil Flynn, senior market analyst at Chicago-based Price Futures Group, told Bloomberg. "Gasoline seems to be leading the way lower. Demand was impacted by the hurricane, although not as bad as some of us feared."
Gasoline for August delivery fell 0.9% or 2.8 cents to reach $2.9918 per gallon on the NYMEX, with futures falling to $2.9884, which is the lowest intraday level since June 11, Bloomberg reported. Diesel for August delivery, meanwhile, fell 0.3% or 0.91 cent to $2.9193.