Friday, February 10, 2012

Oil prices tumble on European debt concern

(AP) ? Oil prices fell Friday with a critical bailout plan for Greece's economy in limbo, again raising the specter of bank failures and bankruptcies in Europe.

The European Union has struggled for years with massive government debts. Investors worry that the festering credit crisis will spread to the rest of Europe, further slowing down the EU economy and reducing demand for oil.

Those concerns heated up Friday after European finance ministers said that Greece has not met the necessary spending cuts for further loans. Greece's government promised to push through new austerity measures, but some lawmakers have balked as unions organized mass protests against the cuts.

"This looks to drag out until the end of the month, now," said Michael Fitzpatrick, editor-in-chief of the Kilduff Report. "A flat-out bankruptcy is back on the table, and is the increasingly likely scenario."

Benchmark crude fell by $1.17 to end the week at $98.67 per barrel in New York. Brent crude fell by $1.28 to finish at $117.31 per barrel in London.

Major stock indices also dropped. They were down about 1 percent in afternoon trading.

Meanwhile, U.S. retail gasoline prices rose nearly a penny to a national average of $3.50 per gallon on Friday, according to AAA, Wright Express and Oil Price Information Service. A gallon of regular is about 13 cents higher than it was a month ago and 38 cents more than at the same time last year.

In other energy trading, heating oil fell by 3 cents to finish at $3.18 per gallon, while gasoline futures gave up 4 cents to end at $2.97 per gallon. Natural gas futures were flat, ending the week at $2.48 per 1,000 cubic feet.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/f70471f764144b2fab526d39972d37b3/Article_2012-02-10-Oil%20Prices/id-3b2b14cfeccd4627a57c682ff09fd77c

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