WTI drops over $3 per barrel

Crude oil prices were significantly lower Tuesday as they dropped from record levels after production facilities in Mexico that had been offline due to bad weather were set to reopen and OPEC said that speculation and politics were to blame for high oil prices even as some analysts said that fundamentals, not speculation, were the cause of the price spike.

West Texas Intermediate crude for December delivery dropped $3.15 to $90.38 per barrel by the close of floor trade on the New York Mercantile Exchange and fell even more after the close in electronic trading, to $89.90 per barrel, while Brent crude on the ICE Futures Europe exchange in London was down $2.88 to $87.44 per barrel.

Nymex November gasoline futures were down 7 cents to $2.26 per gallon, while December heating oil dropped 4 cents to $2.44 per gallon but December natural gas added 5 cents to $8.02 per million British thermal units.

Precious metals prices were lower Tuesday in New York.

December gold dropped $4.80 to $787.80 per troy ounce on the chance that the US Federal Reserve will not act to change interest rates Wednesday rather than cutting rates, as had earlier thought it might.

Silver for December delivery was also lower, falling 10 cents to $14.33, while January platinum plummeted $24.60 to $1,440.90 per troy ounce, retreating from a record high on Monday.

December palladium dropped $3.40 to $371 per troy ounce.

Base metals prices were lower as well.

In New York, December copper dropped 4 cents to $3.48 per pound, while three-month contracts on the London Metal Exchange fell $85 to $7,760 per tonne after going as low as $7,666 per tonne earlier in the session.

Lead was also lower, falling $57 to $3,583 in London, as stockpiles of both metals were higher.

Among other base metals, aluminium dropped $1 to $2,524 per tonne while nickel fell to $31,500 per tonne, zinc prices were down by $60 to $2,845 per tonne and tin traded around $16,650/$16,700 per tonne, down from $16,850 per tonne on Monday.

In agricultural commodities, grain and pork futures declined but beef futures were higher.

December corn on the Chicago Board of Trade fell 5.75 cents to $3.70 per bushel, while CBOT December wheat dropped 14.5 cents to $8.14 per bushel and January soybeans were 19.5 cents lower to $10.09 per bushel.

Meanwhile on the Chicago Mercantile Exchange, December hogs were down 0.57 cent to 53.9 cents per pound and February pork bellies dropped 1.05 cents to 83.05 cents per pound.

Also on the CME, November feeder cattle added 0.7 cent to $1.0995 per pound while December live cattle were up 0.35 cent to 94.37 cents per pound.

Story link: WTI drops over $3 per barrel