OPEC cut production last week. Oil prices fell. Banks cut interest rates last week. Oil prices rose.
Oil climbed more than $4 a barrel on Oct. 29, the biggest gain in a month, after the U.S. and China, the two biggest energy consumers, cut interest rates to spur economic growth. Prices also rose because the dollar fell the most against the currencies of six major U.S. trading partners since 1998.
The price of crude oil is set to have its Worst Month. Ever.
Crude oil for December delivery fell $1.91, or 2.9 percent, to $64.05 a barrel at 9:15 a.m. on the New York Mercantile Exchange. Prices, which have tumbled 57 percent since reaching a record $147.27 on July 11, are down 32 percent from a year ago.
The monthly price drop is set to surpass February 1986 as the worst month ever, when crude oil declined 30 percent to $13.26 a barrel.
And for this, we are thankful.
Unless the oil-producing nations intend to cut production so far that there isn’t enough supply to fill demand—which I doubt—I don’t think this is going to do much. Here’s hoping. The winter season is upon us, and falling oil and gas prices can only help.