Market watch: Energy futures prices continue to tumble
By the OGJ Online Staff
HOUSTON, Sept. 20 -- Energy futures prices continued to tumble in international markets Wednesday, driven down by fears that world demand for petroleum will be a casualty in a US war against terrorism.
The sell-off in equity markets since the terrorist attacks in New York and Washington, DC, last week indicates that the US is leading the world into a recession from which it will not be easy to recover, analysts said.
US commercial airlines are reducing scheduled flights in the face of flagging demand following the terrorist attacks involving hijacked aircraft. Several airlines in the US and Europe announced they will lay off workers in an effort to survive that downturn.
The market for jet fuel, which accounts for about 10% of total refined products, will be severely affected in the process, said analysts.
The October contract for benchmark US sweet, light crudes fell 98¢ to $26.72/bbl Wednesday on the New York Mercantile Exchange. The November contract also was down 84¢ to $27.25/bbl. However, the October contract moved up to $26.89/bbl in after-hours electronic trading.
Home heating oil for October delivery dropped 2.53¢ to 71.9¢/gal on the NYMEX, while unleaded gasoline for the same month fell 4.07¢ to 75.25¢/gal. The October natural gas contract lost 12.3¢ to $2.10/Mcf.
In London, the November contract for North Sea Brent oil closed at $26.32/bbl, down 95¢ for the day after trading in a range of $25.65-$27.60/bbl on the International Petroleum Exchange. The October contract for natural gas inched up 0.7¢ to the equivalent of $3.14/Mcf on the IPE.
The average price for the Organization of Petroleum Exporting Countries' basket of seven crudes plummeted by $1.53 to $24.29/bbl Wednesday.