Crude oil breaks another record; diesel climbs again

| 8/10/2005

Prices for light, sweet crude topped out at a new intraday high of $64.27 in trading on the New York Mercantile Exchange on Tuesday, Aug. 9.

Later in the day, however, prices settled back down before closing at $63.07 per barrel.

Diesel prices, meanwhile, continued their upward climb toward the $3 mark. ProMiles showed an average in California of $2.99 per gallon on Wednesday, Aug. 10, while the U.S. average came in at $2.463 per gallon.

The prices didn’t stop there, however. The Tower Mart in Redding, CA, had diesel going for $3.09 per gallon on Aug. 10, while showed a high of $3.15 per gallon in Modesto, CA.

But the high prices have only slightly slowed demand; a fact, which analysts say, is making investors nervous, according to news reports.

A series of refinery outages in the U.S. in recent weeks, coupled with unease in Saudi Arabia and continued strong demand from China, have all contributed to the increase in prices.

On Tuesday, the U.S. Department of Energy released its 2005 world oil demand growth forecast, predicting less growth in demand by the end of the year. The report said that demand would grow by 1.7 million barrels a day this year to 84.2 million barrels per day. That’s a slight drop-off compared to the 2.2 million in growth the department forecast in July.