Chris Cantell Discusses Markets: Oil prices plummet amid economic fear by Michaela Vargova

NEW YORK - Oil prices fell Tuesday as fears that record fuel prices are going to evoke the third big sell-off in just over a week. The crude plunged 4.4 percent to settle at $138.74 a barrel in this, for America, very volatile economic period. Prices at one point plummeted more than $10 from the day's high, while prices record was written down only on Friday reaching $147.27 a barrel. In present retail gas prices at the pump station in the U.S. remained at a record near $4.11 a gallon, Diesel rose six-tenths of a penny to its own high of $4.83 a gallon.
Dispite the dollar fell to a new low against the euro, which is considered to be the biggest marked decline in dollar terms since the Gulf War, oil prices remain no lower than they were a week ago. The weaker dollar has driven prices sharply higher in recent months, attracting investors to pump money into oil. Following creation of a so called "hedge" against inflation, has made crude cheaper for overseas buyers.
Market observers cautioned the turnaround may not indicate a lasting shift in sentiment. But it underlines investor uncertainty about the sustainability of high prices and their potentially long-lasting effects on the broader economy.
President Bush continued to press the Democratic-run Congress to open up new areas to offshore oil drilling. Even the president lifted a ban on Continental Shelf drilling Monday, Congressional prohibition still remains.
However, the U.S. economy is ailed by further difficulties. Experts warn that rising prices for energy and food could also elevate the risks of inflation. At the same time, the Labor Department reported that wholesale inflation jumped by 1.8 percent last month, a larger-than-expected gain. Though, over the past year, wholesale prices have risen 9.2 percent.

by Michaela Vargova for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.<br><br><font size=2>These news are original content from young talents around the world and are selected for you by Chris Cantell.</font><br>



posted by Lucia Adamova