Posted on 05/05/2011 4:00:19 PM PDT by Signalman
NEW YORK (CNNMoney) -- Oil prices plunged more than 8% Thursday as weak economic data and a strengthening dollar drove crude to its biggest one-day drop since April 2009.
The main U.S. oil contract for June delivery settled down $9.44, or 8.6%, to $99.80 a barrel. That's its lowest level since mid-March and marks its biggest one-day percentage drop in two years. Brent crude, the European benchmark, fell $10.73 to $110.46 a barrel.
The broad underlying fear is that the U.S. economy is slowing down, and traders have a slew of data to back that theory.
On Thursday, a government report showed the number of people filing first-time unemployment claims surged to 474,000 in the latest week -- its highest total in 8 months. That means less demand for oil products because if you don't have a job, chances are you're trying conserve on gas and other energy costs.
(Excerpt) Read more at money.cnn.com ...
But don’t count on gas prices going down.
The reasons are so absurdly simply that people who don't understand them probably can't learn them.
One of the more interesting possibilities here is that the uptick in manufacturing probably reflects yet another productivity improvement driven spell of deflation.
Now that's even more complex so I don't imagine most of the folks on most discussion boards to have the slightest idea of that kind of linkage.
Hey, its the perfect time for 474,000 layoffs, cheaper oil and a higher dollar: summer! Go ahead! Fill up those tanks, and start your get-away-from-it-all engines!
Worry about saving for TEOTWAWKI later! It’s only nearly half a million layoffs a week for several years now. Spending that money is only like putting another round in and spinning the cylinder before another try. [Little simile there.] ‘Sides, if the inevitable happens, those beans and rice will feed you for years! And don’t worry about the neighbors. Theyzz cool.
I didn’t know the economy had done anything but slump for over two years. It will continue to slump until we get rid of the Keynesian crackpots running the show.
Any responsible person wants to know where are the on Mcdonald's jobs.
I don't really care about Wall Street talk about a bubble getting ready to bust.
You were part of the housing bubble and now your young HOPE and Change young Voters are about to create another default problem with unpaid student loans, wonder what they will tell the bill collectors I voted for Obama.
I guess if they work for Mc Donalds the IRS will not allow them any Earned Income Tax because of past due students.
Recovery summer ...er... fall ...er... winter ...er... spring ...er... nevermind.
Actually oil started dropping hard today for the same reason silver has been dropping. I heard today that starting tomorrow they are raising the margins.
I heard the same thing but the price of oil is still way above the cost of production
As always, the best answer to high oil prices is a high oil price. A “high” oil price is deflationary over time as it inhibits economic activity. This leads to a lower oil price and more economic activity.
duh
“The refined gasoline price always lags behind the crude oil price.”
Yes, by about six months.
On the other hand, someone poots in the Middle East and gas goes up 20 cents.
Poots? How about “SHOOTS” ~ Gaddafi is using heavy artillery. NATO is using cruise missiles and bombing runs.
Funny thing about ideologically free economics. They tend to represent reality. In a perverse way, to be sure, I think it’s a hoot that Onada’s baldfaced attempt to drive gas prices at least to $5/gal is being blunted by his equally baldfaced attempt to kill the American economy.
But then Marxist ideology trumps fact, logic and reality every time.
Only when the price of crude is dropping. When it goes up gas price goes up the same day even though the gas in the station's tank was purchased at the lesser price. Not really a complaint, gas station owners gotta eat too, but it's still a shady practice. I try to stick with Murphy's or Sam's - they seem to keep it relatively honest.
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