Yesterday a lot of bad things happened in our economy. But what we must remember is that our system still works, and this is just a part of the proccess. As evidence of this fact check out this “not-so-bad” result of yesterday’s fall out in this story:
Oil prices plummeted Tuesday, falling briefly below $92 a barrel and reflecting market fears that the U.S. credit crisis which brought down brokerage giant Lehman Brothers will drag on global economic growth and restrain demand for crude.
OPEC’s production cut of 520,000 barrels a day earlier this month has failed to stem the decline. The 13-nation group said oil demand in the U.S. fell by 800,000 barrels a day last month due to the slow economy and high retail prices.
And in its monthly report, it said that overall less additional oil was needed on the market, noting that – although the world’s appetite for crude grew by an additional 900,000 barrels a day this year, that was 100,000 barrels less than what was estimated before the onset of the world’s economic malaise.
Once all the dust settles from Ike we should see the benefits of this decrease in demand. If this kind of decrease in demand can play a part in affecting prices like this then imagine how much domestic drilling would affect prices.