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Oil Futures Slide After Wednesday's Gains

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The Associated Press

Published: December 14, 2007

NEW YORK - Oil futures fell Thursday as investors, expecting an ongoing price slide, sold to lock in profits from the previous session's big gains.
Crude prices spiked 5 percent on Wednesday, but two causes of that swing evaporated Thursday when the dollar strengthened and Exxon Mobil Corp. said a Texas refinery suffered no production outages from a fire.

Many analysts argued that Wednesday's gains weren't justified by any fundamental news, including a government report that inventories fell last week.

"We were just overcooked yesterday," said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Ill.

Indeed, an increase in oil supplies at the New York Mercantile Exchange delivery terminal in Cushing, Okla., has pushed the price of January's crude below the price of February's crude, the first time since August that the price of a front-month contract has fallen below that of a later contract.

That price relationship is seen as an indication that oil supplies are rising, and that prices will fall.

Light, sweet crude for delivery in January fell $2.14 to settle at $92.25 a barrel on the New York Mercantile Exchange. February's crude fell $1.82 to settle at $92.46 a barrel. On Wednesday, January's prices jumped $4.37 to their highest close since Nov. 27.

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