Oil prices fell below $97 per barrel Monday just days after spiking above $100. Last week’s surge continued to ripple through global pipelines, however, as gasoline prices jumped 8 cents over the weekend. Crude dropped on reports that Libya was still exporting oil. Shipments were thought to have halted last week as protestors clashed with the government and strongman Moammar Gadhafi lost control of many of the country’s oil fields.
Oil prices hovered below $77 a barrel Tuesday as traders awaited corporate earnings reports for clues about the strength of the global economy and the outlook for energy demand.
By early afternoon in Europe, benchmark crude for August delivery was down 18 cents to $76.36 a barrel in electronic trading on the New York Mercantile Exchange (NYMEX). The contract rose 53 cents to settle at $76.54 on Monday.
Crude oil prices fell as fresh concerns over Europe’s economy spooked the markets and overshadowed a slew of upbeat corporate earnings. Crude for June delivery dropped $1.05 to $82.63 a barrel.
A spate of mostly upbeat earnings reports in the U.S. helped to boost oil prices, after they fell 3% last Friday on the Goldman Sachs fraud charge. But the good news were overshadowed in part by still weak demand, European economic woes, and the Icelandic volcano, which has crippled international travel and shipments.
Oil prices ended the week at the lowest level in nearly two months, weighed down by a stronger dollar and persistent doubts about the health of the global economy. Crude prices have now dropped more than 14 percent since cresting at a 15-month high of $83.18 a barrel on Jan. 6.
Energy prices were propped up earlier in the year by predictions that China, India and other developing nations would aggressively boost petroleum imports to feed their growing economies. But China has since taken steps to control risky bank lending and to cool off its economy.
OPEC is leaving its production quotas unchanged, opting to take a cautious approach in a market awash in crude and a global economy still in the early stages of recovery.
The 12-nation Organization of Petroleum Exporting Countries early Thursday said “market fundamentals have remained weak,” even though current oil prices at about $71 are roughly double their level since December, when the group announced a record 4.2 million barrel per day cut from September 2008 levels.
“Since the market remains oversupplied and given the downside risks associated with the extremely fragile recovery, (OPEC) once again agreed to leave current production levels unchanged for the time being,” the statement said.