Oil falls as dollar soars

22/10/2008

The price of crude oil has fallen for the second day in a row as the dollar put in a strong performance on exchange markets.

On the New York Mercantile Exchange, oil prices fell to $71.62 (£43.63) during trading this morning, according to Bloomberg reports.

The falling price of crude oil - which could have a knock-on effect for kerosene oil users - has been attributed to fears about a looming recession.

The Organisation of the Petroleum Exporting Countries has expressed concern that prices will collapse as global demand for oil wanes.

It has called an emergency meeting due to be held on Thursday, in which it is expected to limit production in an effort to bring prices back up, which could in turn inflate the cost of other derivatives such as DERV or gas oil.

However, the weight of the current downturn may keep prices down.

An earlier cut in production of 500,000 barrels per day failed to have a sustained impact on crude prices, which have fallen more than 50 per cent in six months.