Current Crude Prices Drop

The current crude price drops after the European Central Bank’s head described a weak short term outlook for the economy of the 17 nations using the euro.

The U.S. benchmark for delivery in March was 34 cents lower to a crude price per barrel of $95.52 during midday trading on the NYMEX. In New York, trading was closed yesterday for a federal U.S. holiday. The contract shed $1.45 to end at $95.86 per barrel during the last trading day of the past week.

Mario Draghi, the President of the European Central Bank, recently told the lawmakers of Europe that the outlook of the economy of the eurozone remains weak at the beginning of this year, but it anticipated a regular recovery in the latter parts of the current year.

The forecasts of the ECB for the GDP of the region will decline 0.3 percent this year.

Political progress in two of the struggling economies of the region has also increased the concerns of investors. Spain’s Prime Minister Mariano Rajoy has been pressured to resign due to bribery charges. In Italy, Silvio Berlusconi is being favored in the upcoming elections. Berlusconi, a previous premier, has asked for tax rebates and forgiveness for Italians who were not able to pay their taxes.

Brent, the benchmark used to assign prices to international oil types, was 19 cents lower to $117.47 per barrel on London’s ICE Futures Exchange.

In other NYMEX trading, heating oil shed 0.2 cent to $3.20 per gallon. Natural gas gained 3.2 cents to a price of $3.182 per thousand cubic feet. Wholesale gasoline increased 1.5 cents to a price of $3.329 per gallon.

By: Chris Termeer

Chris Termeer

Chris Termeer is an oil and gas consultant, industry commentator and analyst. His book, Fundamentals of Investing in Oil and Gas provides a comprehensive overview of all aspects of the oil and gas industry, including exploration, drilling, production, storage, transportation and refining, to name but a few.

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