Posted on 07/24/2008 12:26:23 AM PDT by DGHoodini
NEW YORK (Reuters) - Commodity markets slumped broadly Wednesday, dragged by crude oil prices that dropped below $125 a barrel after the government reported a big rise in gasoline stocks, suggesting high pump prices were hitting U.S. fuel usage.
Gold prices sank almost 3 percent while industrial metals such as aluminum and copper tumbled to five-week lows.
Soybeans and wheat fell, giving back most of Tuesday's rebound. Corn slumped too as investors fretted about demand for biofuel products that had until June enjoyed a boom competing with the rally in oil.
The broad sell-off pushed the Reuters-Jefferies CRB index , a basket of 19 commodity futures with a bias toward oil, to 11-week lows.
While the dollar's strength factored into the slide, traders said the key was sagging demand for oil products after crude prices jumped more than 40 percent in seven months.
"The deteriorating demand picture reinforces our belief that oil prices are approaching a tipping point," investment bank Lehman Brothers (nyse: LEH - news - people ) said in a research note.
(Excerpt) Read more at forbes.com ...
It’s like all those who whine about housing prices falling, rather than rejoicing that things are more affordable.
Since President Bush repealed the Executive Order that banned offshore oil drilling, prices have come down to multi-month lows.
Bush’s fault!
Watch what happens to oil prices if I’m right, and most people stay close to home for the Labor Day weekend too.
>Bo)
Lots of people are mad as hell about gas prices, and are staying home for “Staycations” and feathering their nests with a big screen TV, or new furniture, new matresses, a home improvement project, all that use little gas, and less than half of what they would have spent on a traveling vacation...
Buying the grandparents a PC with a webcam, and having an in town relative teach them how to do an easy videoconference call to “visit” with the out of town grandchildren any time they want without a road trip involved.
I’ve started walking to the grocery store. Kills three birds with one stone: get groceries, get exercise and get some sun (before 9 a.m. of course).
You know..back on July 3rd, when this topic came up, I was reminded of the old sturdy Schwinn bicycles, that had the wire baskets in front of the handlebars, that one could actually fit a couple of paper bags full of groceries in...Can’t remember the last time I saw a bike with a basket over the front wheel...
I see bikes like that at the big park here. But they usually have lap dogs riding in them. I have even scene modified baskets so that it is more of a platform for the dogs to lay on as the owner is cycling.
The high prices have done their job. Demand has fallen and the speculators who hung on have taken a bath. Prices could fall a lot more quickly since it only takes one unsold tanker load to cause a glut. The Rats could now be rescued by the free market and low price they despise. We need OPEC to reduce production so we can get the drilling done.
LOL, I read the headline and thought “huh?” Then I read the first line...”commodity markets”, oh that’s what they’re talking about.
They want a Dem for President, so as far as the economy goes, darned if you do, darned if you don’t. Just the opposite of Clinton years when we were sliding downward, and the press was reporting everything was peachy.
There is a very good reason you are thinking that; It is a bad thing to Democrats, Socialists, Marxists, whatever you want to call them.
GW, who has his faults, but never seems to get any credit when he does something right has helped to bring Americans a little relief at the pump. Repealing the executive order has already brought oil down by around 20/bbl. This completely destroys the Rat and Rino argument that drilling will not bring the price of gasoline down.
The socialists want the price high, they want a bad economy, they want to lose wars. They want to stay in AGW fairyland and talk about alternative/renewable energy and other such pipe dreams. They only care about America when they (Socialists) are in power implementing their socialist programs.
If Congress would follow GW's lead and repeal the ban we could very well see gasoline at $2.75-$2.90/gal. by October or November. Speculators are spooked right now, but, that could all dry relatively quick if there isn't some action to keep them wary.
At this point, the only way that’ going to happen is if God decides to drop a few selective lightening bolts down onto Pelosi and Reid, as they walk through puddles to their planes at Reagan Airport. Both of those domestic enemies need crispy fryin.
LOL. No matter what happens in the markets and to the price of oil, the media will write it as a “bad” thing.
When and if the democrats get in, suddenly all will be sweetness and light.
I agree... the author seems to want it both ways. High oil price, bad. Low oil price, bad.
Dont worry, Autumn is around the corner and fuel oil demand will drive prices to record highs.
I wish I was joking
Yeah, well with the per barrel price drop you’d think the prices at the stations would drop a bit, but no, my station increased their diesel prices from $4.79 to $4.81 yesterday!
That is still about $3.75 above what it should be. :-)
OMG, won’t Reid and Pelosi do something? Let’s get the Feds to step in with a program to bail out those who have lost in the downward spiral. Oh, sure, we called them speculators but that’s so last week.
I bought diesel yesterday for 4.55 down from 4.87 at the last fillup.
For the first time in a long while, the price at the Pilot station at Exit 4 on I 81 was less than the Hess station bu .02/gal.
We shall have to wait and see what happens after the Olympics. China has mandated 50% of the cars parked and a huge percentage of their industry shut down in an effort to clean up the air for their “dog and pony show” for the world to see. If the price stays down the deal is for real. If not, we are back to 140 or more per barrel.
Don’t worry, as soon as Goldman Sachs and a few other big players have finished fleecing th retirement and pension funds, oil will go down.
Tyhe thing with that is, there aren’t really that many cars in China comparatively. Most of their pollution comes from their factories, and while they have yet to match a similar western metropolis in the number of cars...Chinese cars don’t have anywhere near the kind of exhaust emissions standards for their cars. Most Chinese car brands, if I remember correctly, don’t even have catalytic converters. So their cars push out a lot more pollution.
Pretty sure they’re still buying oil. They recently began to expand the size of *their* SPR...planning on doubling it I believe.
As gasoline prices went up, demand destruction took place. I wonder what will happen as gas prices recede.
MSN has a gas price map that will help you find the lowest price in your zip code
I have heard it both ways. One that China "built up" a huge supply of oil in the first half the year to make sure there were no shortages for the Olympics. The people who believe that say that China's oil demand will decline when the Olympics are over and oil prices will go down.
The other thing I've heard is exactly what you posted. China has deliberately shut in much of their industrial and transportation sector to ensure clean air during the Olympics. Then when the Olympics are over they will go back to business as usual and that their oil consumption will go back up (taking oil prices up, too).
I don't know which to believe...
Carolyn
That's noble of you. If you have the time, and are only shopping for yourself, and the weather's not inclement, have a happy walk.
For families (like mine) that live a mile or two from the nearest grocery store, elderly people who can't practically walk that far, or for when traffic, heat or thunderstorms don't permit the safe travel for pedestrians, walking isn't an option.
I have my husband, too. It is a mile or so to walk. That’s why I do it to get exercise.
I will still drive to the grocery store if I need something fragile, heavy or perishable, like eggs, laundry detergent, cat litter etc.
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