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Wednesday, April 29, 2009

Crude drops below $50

Crude ends lower for second straight day

Crude oil ended below $50 for the second straight day on Tuesday, 28 April, 2009. Prices fell as fears gripped the overall continent today that the current swine flu might hamper economic recovery from the ongoing global recession.

On Tuesday, crude-oil futures for light sweet crude for June delivery closed at $49.92/barrel (lower by $0.22 or 0.4%) on the New York Mercantile Exchange. Last week, crude ended higher by 2.4%.

Crude ended March trading up 10.9%. It rallied 11.3% in the first quarter. For the month of February, crude prices had ended higher by 1.5%.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 68.8% since then. Year to date, in 2009, crude prices are higher by 9.2%. On a yearly basis, crude prices are lower by 53%.

The deadly swine-flu outbreak, originated in Mexico, has fueled fears of a repeat of the SARS epidemic that had ravaged Asia. In Mexico, more than 1,641 people have contracted the swine flu and 103 people have died. The World Health Organization raised its swine-flu threat level on Tuesday, which now stands just two steps short of a full pandemic. The WHO also said it was now too late to contain the virus.

Also at the Nymex on Tuesday, May reformulated gasoline fell 0.88 cent, or 0.6%, to $1.3995 a gallon and May heating oil gave up 0.62 cent, or 0.5%, to $1.3167 a gallon.

The May contract on natural gas gained 1.7 cents, or 0.5%, to $3.27 per million British thermal units. The government's update on gas in storage will come out Thursday morning.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for May delivery closed at Rs 2,499/barrel, higher by Rs 1 (0.04%) against previous day's close. Natural gas for April delivery closed at Rs 172.6/mmbtu, higher by Rs 3.7/mmbtu (2.1%).

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