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Oil extends decline, drops below $128
(Agencies)
Updated: 2008-07-23 16:30 SINGAPORE -- Oil prices slipped further Wednesday after tumbling more than $3 a barrel in the previous session as a hurricane looked likely to spare key oil installations in the US Gulf of Mexico.
Light, sweet crude for September delivery fell 82 cents to $127.60 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract fell $3.40 to settle at $128.42 in the previous session. The August contract fell $3.09 to settle at $127.95 a barrel as it expired at the end of floor trade. The overnight sell-off dragged oil prices to their lowest level since early June and was crude's fifth decline in the last six sessions. Prices fell as Dolly -- a tropical storm that spun into a hurricane on Tuesday -- headed toward the US-Mexico border but grew increasingly unlikely to threaten key oil supply in the Gulf. That gave traders one less reason to buy as a strengthening dollar helped keep prices in check. The drop offered further evidence that investors are now quickly pulling money out of the market, after driving prices to a record above $147 only a week and a half ago. It was also a reminder that, with traders for the moment turning bearish, the absence of major news can push the market down -- just as incremental supply concerns previously drove prices sharply higher. |
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