Crude ends lower paring earlier gains

Demand concerns weigh on crude prices

Global economic concerns pushed crude prices lower on Monday, 26 January, 2009. Prices were initially trading higher earlier in the day but then, prices fell as news of job cuts swayed across Wall Street today.

On Monday, crude-oil futures for light sweet crude for March delivery closed at $45.73/barrel (lower by $0.74 or 1.6%) on the New York Mercantile Exchange. Last week, crude prices ended higher by 9%. Prices had reached a high of $49 earlier during the day today.

Prices reached a high of $147 on 11 July but have dropped almost 65% since then. Year to date, in 2009, crude prices are lower by 9.6%. On a yearly basis, crude prices are lower by 50%.

It was a job cut bloodbath on this Monday today. Among major accompanies announcing job cuts today were Caterpillar, Sprint, GM and Home Depot. The companies announced layoffs to the tune of 20,000, 8,000, 2000 and 7,000 respectively. Roughly 50,000 layoffs were announced today by US and overseas companies.

Against this background, March reformulated gasoline fell 0.1% to $1.1531 a gallon and March heating oil lost 1.6% to $1.427 a gallon.

February natural gas futures slid 0.6% to $4.49 per million British thermal units.

At the MCX, crude oil for February delivery closed at Rs 2,238/barrel, higher by Rs 39 (1.8%) against previous day's close. Natural gas for February delivery closed at Rs 221.3/mmbtu, lower by Rs 0.4/mmbtu (0.2%).