Oil prices tumbling
Published: Friday, January 19, 2007 at 6:01 a.m.
Last Modified: Thursday, January 18, 2007 at 11:08 p.m.
NEW YORK — Oil prices briefly fell below $50 per barrel Thursday for the first time since May 25, 2005, after the government reported larger-than-expected jumps in crude oil and gasoline inventories.
Oil has dropped 17 percent since the end of 2006 amid weeks of mild winter weather in the U.S. Northeast, a key consumer of heating fuels, and growing energy stockpiles.
"There's no doubt that this is significant," said Phil Flynn of Alaron Trading Corp. "If you're a bull, the only thing you can hold your hat on is they didn't close below $50."
The price for a barrel of light, sweet crude for February delivery fell as low as $49.90 on the New York Mercantile Exchange but spent only a moment below the $50 threshold. It settled at $50.48, down $1.76 from Wednesday's settlement price.
Jim Ritterbusch, president of Ritterbusch & Associates, said prices could continue to fall toward $47 in the next two weeks, unless the Organization of the Petroleum Exporting Countries calls for a meeting. "The market is still seeking a bottom," he said.
U.S. crude oil stocks rose by 6.8 million barrels to 321.5 million, according to a report by the Energy Information Administration. Gasoline inventories, meanwhile, rose by 3.5 million barrels to 216.8 million, above analysts' expectations of a 2.6 million barrel rise.
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