Oil Prices Spike Again

Paul Maidment
Forbes.com

NEW YORK - Crude oil prices spiked up Thursday, raising fears that oil's recent retreat from the $42 a barrel high reached in May is over.

The benchmark U.S. crude was trading at $38.90 Thursday afternoon in New York, up $1.85 from the previous day, which itself saw a $1.39 rise.

Traders remain concerned about the tightness between supply and demand, which reinforces their fears about the potential impact of any supply-disrupting terrorist attacks, particularly in the Middle East.

Figures released by the U.S. government on Wednesday sparked this latest rally in prices. They showed that crude stocks in the U.S. last week fell by 500,000 barrels from the previous week, and that inventories of gasoline were unchanged. Analysts had expected crude stocks to increase by 1.5 million barrels.

The figures also showed that U.S. crude oil imports averaged 10.6 million barrels a day last week, up 403,000 barrels a day from the previous week, and the fourth highest weekly average on record. That suggests that demand in the world's largest energy consumer continues to grow at a time when there is very little excess oil production capacity available globally.

Home Loans Articles, Mortgage Loans Articles, Financial News