Oil Dips Below $80 Amid Global Economy Fears
The US economy is still weak and Europe’s mounting debs are creating problems for the automotive industry as well, with many automakers operating on the continents believing 2012 will bring reduced sales figures.
"People are just afraid that demand is going to be affected in a negative way and that's pulling prices back down," said Tom Bentz, an analyst at BNP Paribas Commodity Futures.
In midday trading today, oil slid 87 cents to $79.64 per barrel, only a day after it plunged a full six percent. In London trading, Brent crude, which is used to calculate a number of petroleum, has fallen 91 cents today.
Factors that are contributing to the seesaw action on the market include the unexpectedly high unemployment rate in the US and the slowed rate at which China is growing.
Some analysts it should stay between $75 and $90 per barrel until a better image of what’s ahead emerges, but it has gone much lower than that in recent years.