It’s a second day that the oil has dropped in New York, on apprehensions of a weak demand for fuel by the US, along with a slow import of crude from China. There is a feeling that the world’s leading energy consumer will decrease its demands.
There was about 1.9 percent drop in the futures on October 13, 2011. Further reports from the American Petroleum Institute said that the demand for gasoline too slid, remarkably since last five years. China’s net imports of crude has declined said the custom bureau.
“Oil prices are still high compared to the economic risks we face, not only in Europe but also in the U.S. and Asia,” said Sintje Diek, the analyst at HSH Nordbank in Hamburg who so correctly said in January that prices would fall in the next half of the year 2011. “Overall, volatility is very high.”
Furthermore on the New York Mercantile Exchange, the crude for November delivery declined and reached $83.94 a barrel. However at 1 pm (London Time) on the same day it was at $84.11. Overall this year the prices are down by 8 percent.
Meanwhile Saudi Arabia, the largest producer of oil in the OPEC declined any excess oil production, and the oil minister, Ali-Al-Naimi said that they have strived hard to match the demands in the oil markets. Libya on the other hand, has a potential to produce as much as 100,000 barrels per day on an average basis, while Saudi Arabia can produce only 9.76 million barrels per day. Libya thus is the only country presently which is not producing oil beyond its official limits.
Oil may further increase losses in the New York futures of the IT industry. Prices have increasingly come to close around the $84.86 per barrel a day.
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