Oil steady after $4 slide

28/01/2009

Oil prices have remained stable during trading so far this morning (January 28th) after the commodity fell more than $4 (£2.80) yesterday.

The New York Mercantile Exchange's main contract - light, sweet crude for March delivery - had fallen nine cents by 11:00 GMT and was trading at $41.51 a barrel.

Yesterday's nine per cent slide came as new figures showed that consumer confidence in the US has hit a record low this month, while housing figures also showed an 18 per cent drop in prices in November.

Both sets of data could well dampen demand for crude derivatives such as heating oil, DERV and petrol as consumers look to rein in expenditure during this period of economic hardship.

Meanwhile, Peter Beutel, president of Cameron Hanover, an energy consulting company in New Canaan, Connecticut, told Bloomberg that many analysts are uneasy about supply figures due to be published by the US Department of Energy later today.

Weak demand statistics could weigh crude and derivatives such as heating oil down further.