Has Oil Finally Choked Itself?
Source: Mineweb.com (7/8/08)
Benchmark crude oil futures punched decisively through USD 140 a barrel on Tuesday, amid a sea of news signalling that the world's leading energy raw material was inflicting serious damage on economies, profits and consumers. The leaders of the Group of Eight largest economies said in a statement that soaring oil and food prices pose a "serious challenge" to world economic growth...
Fiat, Italy's biggest automaker, said it would close four of its six auto plants in the country for three weeks, following slumping sales. German transnational Siemens said it would eliminate 16,750 jobs worldwide, in the face of a slowing global economy.
Tuesday's sell off in crude oil, to levels USD 10 and more below the record USD 147 a barrel levels seen last week triggered a sell off in commodities across the board, aggravated by a slightly stronger dollar. Listed resources stocks were hammered; in London trade, BHP Billiton and Rio Tinto, two of the world's leading diversified mining stocks, sold off at stages by more than 6% on the day.