Jobs report sends oil to lowest price in 6 months

NEW YORK  — The price of oil plunged to its lowest level in nearly six months yesterday, falling below US$100 per barrel for the first time since February. A drop in gasoline prices can’t be far behind. It’s a welcome trend for motorists, with the summer driving season just around the corner. And it eases some pressure on the US economy, which has shown only agonisingly slow growth in the nearly three years since the Great Recession ended.

Oil fell US$4.05, or four per cent, to US$98.49, after a weak US jobs report offered the latest evidence that the global economy is weakening, possibly reducing demand for oil. At the same time, there is mounting evidence that world oil supplies are growing. “The jobs report was the coup de grace,” said Judith Dwarkin, chief energy economist at ITG Investment Research. “But it’s hard to see how prices could have stayed on the boil given ample supplies and continued economic uncertainty.”

AP