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Home Front Economy
Oil drops below $100
2008-03-21
LONDON (Reuters) - Oil fell below $100 a barrel on Thursday for the first time in two weeks, extending a hefty sell-off in the previous session on growing concerns an economic slowdown in top consumer the United States would undermine global energy demand.

U.S. crude was down $3.00 to $99.54 barrel by 1302 GMT, and the first time since March 5 that it has fallen below $100, adding to an almost $5 loss on Wednesday. London Brent crude fell $2.42 to $98.31 by 1305 GMT.

"We continue to see profit-taking among commodities. There are also macro-economic concerns about the economy and the dollar has been doing better," said Mike Wittner, global head of oil market research in London for Societe Generale.

Gold dropped more than 4 percent to a one-month low Thursday, while platinum slid more than 5 percent to $1,820 an ounce, the lowest since early February as funds cashed in.

Weekly U.S. stocks data released on Wednesday showed lower fuel stocks than forecast, but the figures also revealed a fall in demand. U.S. demand for gasoline over the past four weeks was 0.1 percent below last year, the U.S. Energy Information Administration figures showed.
Posted by:Steve White

#9  "our esteemed representatives are spending all this year on protecting their phoney-baloney jobs"
I can't figure out what they are doing besides that, #7 AH.

I'm in the process of writing a yearly legislative update mostly about pending federal legislation on a particular (fairly broad) subject. Since this is the second year of this Congress, I started by updating the legislation I listed last year.

99% of it has had no action since introduction and assignment to committees a full year ago. I'm not saying that's a bad thing, since (IMO) some of the pending bills are spectacularly stupid. But it does make you wonder what exactly they're doing up there that they can't even schedule hearings (including on bills introduced by powerful legislators of the respective house's majority party).

Guess they're too busy doing the really important stuff like showboating for television holding "hearings" on baseball steroid use, ferchrissakes, which is none of Congress' goddam business anyway.

And they wonder why their approval ratings are lower than the President's.

If pro is the opposite of con, etc.... >:-(
Posted by: Barbara Skolaut   2008-03-21 20:14  

#8  China has 2 choices, both bad. Let the dollar fall in relation to the yuan and take the hit in export volume (and jobs) as Chinese goods get expensive. Or continue to peg the yuan and pay through the nose for imports like oil. It seems like either way, something big is about to break.
Posted by: Zebulon Unomolet6509   2008-03-21 19:14  

#7  "Bankrupt the hedge funds and outlaw their business model." I almost hate to say it, but this makes a case for Congressional hearings on the subject and specifically directed legislation, a la Glass-Steagall or the Securities Exchange Act of 1934. Not going to happen, since our esteemed representatives are spending all this year on protecting their phoney-baloney jobs.
Posted by: Anguper Hupomosing9418   2008-03-21 16:10  

#6  I dunno.

Hedge fund backer Bear-Sterans collapses and 2 other hedge fund backers are on the ropes...

All of a sudden the commodities runup runs out of steam because the hedge fun speculators and no longer borrow money to manipulate the futures markets...

Seems pretty connected to me.

Bankrupt the hedge funds and outlaw their business model.
Posted by: OldSpook   2008-03-21 15:38  

#5  I think the PRC economy is right on the edge of taking a stumble right now, they've been caught selling counterfeit drugs, that's a HUGE loss of "Face" right there, no trust, no sales.
Posted by: Redneck Jim   2008-03-21 13:35  

#4  The PRC economy will keep growing at 10% as long as their exports keep growing at 20%. We, and more recently western Europe, are funding $100/barrel oil from our enemies.
Posted by: ed   2008-03-21 12:03  

#3  dont worry, they are heading for a market reset too.
Posted by: Snaiter Peacock9953   2008-03-21 11:22  

#2  fwiw,

US consumption of oil products (gasoline + distillates + other stuff) has been running 1-3% below last year for the past month or so.

The interesting thing here is how long the PRC economy can keep growing. I've been expecting their economy to crash every year since 2001. When it does, their oil product consumption will drop 10-20% and price of oil will likely deflate by a good deal. Given all the money going into getting the Olympics ready, maybe the crash will be postponed.
Posted by: mhw   2008-03-21 09:34  

#1  Make damn sure those who bid it over 100 pay in full and take delivery. No escape clauses. No good o'boy deals.
Posted by: Procopius2k   2008-03-21 08:38  

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