Crude oil prices fell to a two-month low in New York today after the government reported that U.S. crude output climbed to the highest level in more than 15 years. Crude oil for November delivery declined $3.75 to $88.14 a barrel on the New York Mercantile Exchange. It was the lowest price since Aug. The 4.08% slide was biggest one-day percentage drop since June 21. Oil prices are down 11% this year. Gas prices might drop soon as well. Gas prices often fluctuate with the price of crude.
More fuel efficient cars and the high prices of the last few months have cooled off demand for gasoline. Total fuel demand fell 0.3 percent to 18.3 million barrels a day in the four weeks ended Sept. 28, the lowest level since April. Crude and distillate stockpiles declined as gasoline supplies rose.
Crude oil supplies dropped 482,000 barrels to 364.7 million barrels. Stockpiles were up 8.4 percent from a year earlier. Inventories were forecast to increase 1.5 million barrels, according to the median of 11 analyst estimates in a Bloomberg survey.
One reason given for the drop in oil prices, besides increased output, is fears about the economy in Europe and China. Speculators do not want to buy high, and then if demand falls off later, they have to sell at a loss.