Oil prices ease as storm worries fade

By Hibah Yousuf, staff reporter


NEW YORK (CNNMoney.com) -- Oil prices slipped Monday, falling from a 7-week high settlement price during the previous session, as concerns about the tropical storm in the Gulf of Mexico began to ease.

What prices are doing: Crude oil futures for August delivery fell 61 cents, or 0.8%, to $78.25 a barrel.

The national average price for a gallon of regular unleaded gas increased to $2.756, up 0.1 cent from the previous day's $2.755, according to motorist group AAA.

What's moving the market: Fears that tropical storm Alex could threaten oil production and BP's clean up in the Gulf of Mexico faded after the National Hurricane Center's forecast showed that the storm will leave the key areas unaffected.

Investors also digested proposals made at the G-20 summit over the weekend. Global leaders agreed to cut their budget deficits in half by 2013 and make banking systems safer.

The drilling moratorium in the Gulf, which has been in effect since April, does not impact any current oil production.

What analysts are saying: "There's a good chance we'll come off the huge increases from Friday," said energy economist Jim Williams, president of WTRG Economics. "Even if the storm develops into a hurricane, it looks like it won't really be a big one and won't really affect oil production much."

Williams described the outcome of the G-20 meeting as a "yawn."

"Everyone had the same message going into the meeting as they did coming out of it: they'll work to tighten budgets, cure the deficit problem, but it will be a while. So there's no compelling reason for prices to move upward." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.92%3.91%
15 yr fixed3.05%3.08%
5/1 ARM3.03%3.14%
30 yr refi4.00%3.98%
15 yr refi3.10%3.12%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 18,041.54 -190.48 -1.04%
Nasdaq 5,032.75 -56.61 -1.11%
S&P 500 2,104.20 -21.86 -1.03%
Treasuries 2.14 -0.08 -3.52%
Data as of 4:46am ET
Company Price Change % Change
Bank of America Corp... 16.50 -0.25 -1.49%
Apple Inc 129.62 -2.92 -2.20%
General Electric Co 27.52 -0.16 -0.58%
AT&T Inc 34.67 -0.04 -0.12%
Time Warner Cable In... 183.60 12.42 7.26%
Data as of May 26

Sections

The value of the Marlboro brand continues to rise even as global hostility towards Big Tobacco has arguably hit at an all-time high. More

Unemployment is at its lowest level since 2007, but some companies are still cutting lots of jobs. More

Hong Kong's week-long Bun Festival means booming business for local bakery Kwok Kam Kee, which has produced the holiday's delicious highlight for decades. More