ST: Oil and gas prices fall again on evidence consumers are worried
By CHRIS KAHN , Associated Press
NEW YORK - Energy prices dropped Friday with more evidence that U.S. consumers will not be the driving force behind an economic recovery.
Benchmark crude for September delivery gave up $1.81 to $68.71 a barrel on the New York Mercantile Exchange. In London, Brent prices lost 42 cents to $73.06 a barrel on the ICE Futures exchange.
Prices for oil and gas contracts fell along with equities markets in morning trading after the Reuters/University of Michigan index of consumer sentiment fell sharply in the first part of this month. Traders took that as a sign that consumers will be cautious about their spending.
The report comes amid a string of weak earnings reports from major retailers. On Friday, Abercrombie & Fitch Co.reported a fiscal second-quarter loss and its third straight quarter of double-digit sales declines.
"It's very hard for people to get excited about energy demand when the consumer feels stretched," oil analyst Phil Flynn said.
Earlier this week, the government said the country's petroleum supplies remain well above average as demand continues to slump.
Meanwhile, retail gas prices were unchanged at a national average of $2.647 a gallon, according to auto club AAA, Wright Express and Oil Price Information Service. A gallon of regular unleaded is 14.3 cents more expensive than it was last month, but it's still $1.131 cheaper than last year.
In other Nymex trading, gasoline for September delivery gave up 3.88 cents to $1.9804 a gallon. Heating oil fell 3.4 cents to $1.8688 a gallon. Natural gas for September delivery dropped less than a penny to $3.327 per 1,000 cubic feet.
