Oil price drops below $78 a barrel

While it is logical to expect that the demand for crude has and will continue to fall as the worldwide economic slowdown continues, the current levels of decline are not related to that fundamental part of the equation. Massive hedge fund and speculator margin calls are more responsible for the forced selling that has deepened and accelerate the price declines we have seen these past 10 trading s...

David Jolly in Paris reported in the October 11-12 issue of the International Herald Tribune that oil prices fell on Friday to their lowest level in over a year. The International Energy Agency cut its forecast for global demand as the world’s economy slowed. Forecast for 2008 demand was reduced by 240,000 bbl/day. Total consumption for the year will average 86.5 million bbl/day. It is the slowest...