Commodity Corner: Oil Falls with Negative Economic News
The September futures price for a barrel of crude oil lost ground Tuesday on unfavorable economic news.
Oil settled at $77.50, a $1.48 decline from the previous day's trading, after The Conference Board reported a sharp drop in its Consumer Confidence Index for July. Based on a monthly survey of 5,000 U.S. households, the short-term economic indicator for July is 7.2% lower than The Conference Board's finding for June -- another down month. Adding to traders' concerns about oil demand was a Standard & Poor's report observing that U.S. home price levels -- despite some positive signs over the past year -- still do not appear to be recovering on a sustained basis. "The last seven months have basically been flat," according to an S&P executive cited in a statement Tuesday.
Oil prices fluctuated from $76.88 to $79.69.
Natural gas futures, meanwhile, were on the ascent Tuesday. August natural gas settled at $4.68 per thousand cubic feet, a seven-cent improvement from Monday. The increase stems from expected higher demand for electricity through much of next week, prompted by predictions of hotter-than-normal temperatures for the period throughout the eastern half of the U.S. Front-month natural gas traded from $4.60 to $4.69 during Tuesday's session.
The price of a gallon of gasoline for August delivery slipped five cents Tuesday, settling at $2.06. The intraday range for gasoline was $2.05 to $2.12.