Oil On 2-Week Slide Even With Mideast Turmoil
NEW YORK (AP) — The price of oil fell for the ninth straight day Wednesday as global supplies continue to flow despite unrest in the world's most important oil-producing region.
The prolonged drop could lead to lower gasoline prices for U.S. drivers in the weeks ahead.
In the Middle East, the insurgency in Iraq is far from resolved, but hasn't halted oil exports. The fighting now seems unlikely to spread to Iraq's major oil fields. Tensions between Israel and Hamas have escalated in the past week, but aren't threatening any major oil production.
On the supply side, Libyan crude exports appear poised to surge after an agreement between the government and local militias cleared the way for export terminals to open. And U.S. production continues to soar.
At the same time, refiners have already made much of the gasoline needed to fuel road trips for summer vacationers, so crude demand will begin to ebb over the next couple of months. Meanwhile, the nation's oil supply as of July 4 was 382.6 million barrels, up 2.3 percent from this time a year ago.
"We in the U.S are sitting on a ton of crude oil," says energy analyst Stephen Schork of the Schork Group. "We're at the point in the season we have a lot of supply and demand is about to fall."
U.S. benchmark crude fell $1.11 Wednesday to close at $102.29 in New York. That's slightly lower than the price on June 6, before insurgents seized the Iraqi city of Mosul, and 5 percent below the ten-month high of $107.26 reached June 20 at the height of concerns over the insurgency. Schork expects to see oil fall further, to under $100 per barrel, in the coming weeks.
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