Monday, May 07, 2012

Oil price dropped more than $6 in the first week of May

Only two days really mattered in the oil markets this past week. After mild oscillations the first three days of the week, the spot price of West Texas Intermediate dropped Thursday by a little more than 2-1/2 dollars per barrel on an unexpectedly weak ISM non-manufacturing report. And crude fell just over 4 dollars a barrel on Friday on the disappointing jobs report.

Net for the week, the spot price for West Texas Intermediate dropped $6.44 per barrel to settle at $98.49. This is the first time spot WTI settled below $100 per barrel since early February 2012. This will help the Fed with its forecast for softening inflation and may even put back a little money in consumer wallets. Lower gasoline prices will help offset soft employment.

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