Oil takes a tumble as Fed declines to offer new stimulus
Crude oil declined below $79 a barrel to its lowest levels since September on the New York Mercantile Exchange, extending the drop after the Federal Reserve pledged to keep interest rates at a record low through mid-2013.
U.S. benchmark crude for September delivery, West Texas Intermediate, dropped $2.01 to $79.30 on the New York Mercantile Exchange. That was the commodity's lowest settlement since Sept. 29, 2010. Futures have fallen 17% so far this month and are now down 13% for the year.
European benchmark Brent North Sea oil for September delivery dropped $2.35, or 2.3%, to $101.39 a barrel on the ICE Futures exchange in London. Earlier, it had fallen as much as $5, to $98.74, briefly drifting below $100 for the first time since Feb. 8.
Flynn added, "The Fed didn't need to tell us they were keeping rates low. We already know that. There is a little bit of disappointment about that. Add to that the numerous reports from sources like the Energy Department on lower oil demand and we have another decline. Oil can be a safe haven, but only if you believe the global economy is going to move up reasonably and steadily."
Retail gasoline prices continued to decline, falling to a national average of $3.652 for a gallon of regular from $3.703 a week ago, according to the AAA Fuel Gauge Report. In California, the average price of a gallon of regular gasoline was $3.783, down from $3.816 a week ago.
-- Ronald D. White
Chart: The 12-month rolling average for the price of regular unleaded gasoline in California and in the U.S. Credit: AAA Fuel Gauge Report