Oil Prices Leap

June 05, 2008

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After falling for several days, the price of crude oil took an unexpected jump Thursday on the New York Mercantile Exchange. Light sweet crude for July delivery leaped $5.49 late in the day to close at $127.79 a barrel.

The only explanation analysts could come up with for the surge was that after comments from the European Central Bank, the dollar weakened again, and commodity prices in general rose.

Oil prices have fallen since striking record peaks above $135 last month. On Tuesday, prices dropped below $124 a barrel.

In fact, according to published reports, analysts in the past few days have been predicting a sharp drop in oil prices, saying weakness in the U.S. and global economy, along with increased attention to energy efficiency, would curb demand. Most analysts seem to believe this is a temporary blip and that prices will continue to drop next week.

Diesel prices are currently averaging $4.77 a gallon, according to figures compiled by the Oil Price Information Service in cooperation with Wright Express and AAA.

Meanwhile, Reuters reports that The U.S. Commodity Futures Trading Commission and international market regulators will meet next week in Washington, D.C., to address concerns about possible manipulation in the energy markets.

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