Commodity Corner: Crude Continues to Drop on Recovery Fears

The price of a barrel of crude oil continued spiraling downwards Tuesday after a report on housing activity showed signs of a slowing economy.

October crude futures fell $1.47, settling at $71.63 a barrel, at an eleven-week low. Analysts were met with disappointing data as sales of existing homes fell 27.2 percent in July to an annual rate of 3.83 million units. According to the National Association of Realtors, home sales dropped to their lowest level since the late 1990s. Also contributing to the weakening economy were high unemployment numbers and a warning from the Chicago Federal Reserve president that the risk of a double-dip recession was higher than six months ago. Analysts remain grim on the turnaround of crude prices, as they anticipate more bearish economic reports.

The intraday range for oil was $71.45 to $73.05.

Although no immediate weather-related threats were imposed by Hurricane Danielle to the supplies in the Gulf of Mexico, natural gas prices edged lower Tuesday. Prices faced pressure as the end of summer nears, due to the decrease in demand of natural gas. Natural gas ended the day at $4.05 per thousand cubic feet, after trading between $4.03 and $4.09.

October gasoline futures closed at an eight-month low at $1.85 a gallon. The price of a gallon of gasoline ranged from $1.84 to $1.88.