Commodity Corner: Crude Drops with Shaky Economy
With a hurricane-free Gulf of Mexico and shaky economic recovery, natural gas futures for October delivery remained almost unchanged Tuesday.
Natural gas prices rose 0.4 cent, settling at $3.82 per thousand cubic feet, as Tuesday echoed similar weather conditions. According to the National Hurricane Center, Tropical Storm Fiona is headed up the East Coast and should steer clear of the Gulf of Mexico. Additionally, a weather system offshore West Africa holds a 10% chance of forming into a tropical depression. Analysts predict bearish prices as hurricane threats pose a greater risk of power outages.
As the summer cooling season ends and the winter heating season approaches, industrial gas consumption remains a vital component of demand which causes traders tend to focus heavily on economic data.
The intraday range for natural gas was $3.73 to $3.88.
Meanwhile, the October futures price for a barrel of crude oil tumbled $2.78 to $71.92 as investors focused on increasingly high U.S. oil supplies and a weakening economy. Analysts anticipated that the U.S. Energy Information Administration would report Wednesday that crude stockpiles last week continued to expand due to sluggish demand. With inventories setting record highs, the market focuses on economic data. The Dow Jones Industrial Average plummeted about 30 points following the Federal Reserve's August meeting. Oil continues to trail the stock market.
Gas prices fell four cents, settling at $1.89 Tuesday, after fluctuating between $1.87 and $1.94.