Oil, metals, grains all see declines

Crude oil prices fell steeply again Tuesday on continuing demand worries after yesterday’s bankruptcy of Lehman Brothers (NYSE: LEH), today’s credit downgrade of American International Group (NYSE: AIG), and the decision by the Federal Reserve to hold US interest rates steady rather than cutting them as some had expected.

October contracts for West Texas Intermediate crude were down $4.37 to $91.34 per barrel on the New York Mercantile Exchange, taking the front-month contract $55 lower than its peak in July above $147 per barrel, while Brent crude dropped $3.92 to $90.33 per barrel on the ICE Futures Europe exchange in London.

In afternoon trade, Nymex gasoline October gasoline was down 14 cents to $2.42 per gallon while November heating oil fell 7 cents to $2.72 per gallon and October natural gas dropped 6 cents to $7.31 per million British thermal units.

In metals markets, December copper was down 5 cents to $3.09 per pound in New York after going as low as $3.02 earlier in the session, it’s lowest price in 8 months, while three-month copper dropped $60 to $6,870 per tonne in London.

Precious metals prices were also lower, with December gold down $6.50 to $780.50 per troy ounce in New York while Decmeber silver fell 62 cents to $10.52 per troy ounce and October platinum dropped $107.70 to $1,068.50 per troy ounce.

Demand worries due to the weakening global economy also sent grains prices lower on the Chicago Board of Trade.

CBOT December corn was down 30 cents to $5.32 per bushel while December wheat fell 37 cents to $6.90 per bushel and November soybeans dropped 59 cents to $11.20 per bushel.

Story link: Oil, metals, grains all see declines