Us and Europe’s Clash over the Debt Crisis causes Oil to Drop

September 16, 2011 witnessed sharp drops in the Oil prices, as the US and Europe brawled over the recent debt crisis that arose in Greece.

Benchmark West Texas Crude lost about 1.6% and closed at $87.96 a barrel in the city of New York.Brent Crude on the other lost about 8 cents and landed at $112.22 in London, which is a base for pricing various foreign oil varieties.

The US treasury’s Chief, Timothy Geithner is yet to meet The European Finance Ministers, located in Poland, depicting the growing US concerns over the direction in which Europe is heading. The potential Greek default might affect the entire European continent as well as might reach the US.

The weak global economy is attributed to low energy prices and further uncertainties from Europe has forced experts to feel tremendous pressure in the energy sector. Europe is a large user of crude amounting to about 18% of global production.

The US thus is now moving towards a strong decision, while the European leaders seem to be pushing back, postponing the decision to increase Greek payouts, until this October. This has triggered experts comment that the European Government is in no mood to solve the issue.

There are several associated speculations with the use of energy consumption, unemployment being the greatest of them.Less employment will hold back people from using more oil and energy resources. At the Gas pumps, retail Gasoline fell once again after a consecutive 5 day fall.The national oil average fell by a penny and reached $3.611 a gallon, according to the reports of the club AAA, Wright Express Oil Price Information Service.

Thus the world seems to be heading towards a rather uncertain if not completely weak economy.

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