Wednesday, October 2, 2013

Oil falls under $102 after a Partial US Government shutdown

Prices of Oil fall below $102 per barrel on Wednesday after a budget impasse in Washington that resulted to a partial US Government shutdown. It also resulted to 800,000 Federal Workers being furloughed.

The benchmark oil for November delivery fell 44 cents to $101.60 per barrel. The contract fell 29 cents to close at $102.04 a barrel in New York.

It is also expected to weaken the demand for oil in the U.S. as the shutdown curbs economic growth and keep 800,000 federal workers from driving to work.

"Oil prices are very much linked with U.S. consumption," said Andrew Sullivan, sales trader at Kim Eng Securities in Hong Kong. "With 800,000 workers not being paid, short-term demand is likely to be curtailed."

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