Oil falls ahead of Labor Day
COLUMBUS, Ohio - Oil prices dropped again yesterday despite new indications that the US manufacturing and housing industries may be on the mend.
Benchmark crude for October delivery fell $1.91 to settle at $68.05 a barrel on the New York Mercantile Exchange. The contract Monday lost $2.78 to settle at $69.96, meaning crude has fallen almost 6 percent this week.
Yesterday, however, it appeared energy prices were rebounding after the Institute for Supply Management said its manufacturing index rose to 52.9 in August. That is the first reading above 50, which indicates expansion, since January 2008. It’s also the highest since June 2007.
That type of news this year has pushed energy prices higher because if heavy industries are ramping up production and people are buying homes, it is likely spending on energy will rise.
Gas consumption fell 5 percent for the week ended Friday from a year ago when Hurricane Gustav caused a spike in consumption along the Gulf of Mexico, according to the MasterCard Spending Pulse report.
Prices at the pump, meanwhile, fell 0.3 cents to $2.60, according to auto club AAA. Prices are 6.9 cents above levels of a month ago, but $1.07 below year ago levels.