Oil Prices Sink

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Oil Prices Sink

11/30/2001
NEW YORK -- January crude oil futures sank another 26 cents to end at $19.22 per barrel on the New York Mercantile Exchange yesterday. Analysts are attributing oil's current downward spiral to several factors, including a production dispute between OPEC and its main rival Russia.Yet full stocks of heating oil in the U.S., caused by unusually warm temperatures in the Northeast, have also assisted the decline. A shortage last year caused energy prices to remain high through the winter. Jet fuel has also continued to pile up as Americans remain skittish about air travel.According to the U.S. Department of Energy, average retail price for regular gasoline has fallen accordingly for the tenth straight week, dropping 4 cents to 112.7 cents per gallon.Although margins on gasoline have not necessarily improved for retailers, the lower prices and added supply stability may help retailers in the short term, by encouraging more in-store purchases during the holiday travel season.OPEC has already vowed to slash production by 1.5 million barrels a day starting in January. The group has requested that non-OPEC exporters Russia, Norway, Mexico and Oman reduce their output as well, to restore oil to OPEC's $25 per barrel target rate.