Crude Cools on Slowing Fuel Demand
Oil prices dropped below $129 a barrel. The sharp decline came amid a growing sense that soaring gas and oil prices have cut demand for fuel during the normally busy summer driving season. At the pump, retail gasoline prices rose, but only slightly.
Light, sweet crude for July delivery fell $3.34 to settle at $128.85 a barrel on the New York Mercantile Exchange, but slid as low as $128.18 in after-hours electronic trading. It was oil’s biggest one-day decline since March 31.
Tuesday’s oil price decline was notable since it came with news of supply problems in Mexico and Nigeria that could have driven oil prices higher — an indication that demand concerns are weighing on the market.
In other Nymex trading, June gasoline futures lost 1.3 cents to settle at $3.383 a gallon, and June heating oil futures gave up 6.64 cents to settle at $3.7992 a gallon. June natural gas futures fell 5.6 cents to settle at $11.801 per 1,000 cubic feet.
In London, July Brent crude futures dropped $4.06 to settle at $128.31 a barrel on the ICE Futures exchange.
