AP: US Commodities: Nymex Crude Falls Below $70; Gold Slips Too
CHICAGO (Dow Jones)--New York Mercantile Exchange crude oil futures ended below $70 a barrel for the first time since August 2007 after government data showed a drop in U.S. demand. November crude finished at $69.85 a barrel, down $4.69.
A government report released Thursday showed U.S. oil demand in the four weeks ended Oct. 10 reached the lowest level since June 1999. The report, issued by the Department of Energy, showed large builds in crude and gasoline inventories.
Reflecting the increasingly gloomy economic outlook, forecasters at organizations ranging from the International Energy Agency to the Organization of Petroleum Exporting Countries have recently cut global demand forecasts for the remainder of the year and 2009.
"Until something changes (market) sentiment, prices are more likely to go down than up," said Kyle Cooper, an analyst with IAF Advisors, a Houston-based energy advisory firm.
"We just have to wait and see what changes that sentiment." OPEC is moving up its emergency meeting to Oct. 24, instead of the previously scheduled Nov. 18.
The announcement comes as a number of OPEC nations, including Iraq and Nigeria, are being forced to review their 2009 budget spending plans because of the tumble in crude prices, which are down 54% since their summer peaks. Activity In Other Key Commodity Markets:
GOLD: Prices on the Comex division of Nymex ended sharply lower as traders exited positions amid risk aversion and to meet margin calls, both in the metal itself or to raise cash for other markets. Most-active December settled $34.50 lower at $804.50 an ounce.
COTTON: Short covering, in which participants buy back previously sold contracts, lifted cotton on the ICE Futures U.S. exchange 5%. December cotton posted a 203-point gain to settle at 49.57 cents a pound.
Cotton trading may turn bullish in the longer term amid low production expectations, but the broader economic picture must stabilize first, said Sharon Johnson, senior cotton analyst at First Capitol Group in Atlanta.
-By Angie Pointer, Dow Jones Newswires; 312-750-4075; angie.pointer@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/al?rnd=3N1Yh%2B763c8JAxskzsObjw%3D%3D. You can use this link on the day this article is published and the following day.
