*Sorry for the late post folks. I have unfortunately been sick extending my labor day long-weekend further than anticipated. I do try to at least post once daily but I let the ball slip.
On Tuesday as most of you are well aware of, Oil prices fell to a new five-month low, allowing the $100/barrel.
The demand side of oil fell as supply fears were extinguished as Gustav only affected the perimeter of the Gulf's 'Oil Patch' and drove the prices of oil further down. Although terrible for investors, I am thankful that a Katrina level incident did not repeat itself and cause as much hardship for the people of the American south.
As of now, Oil production in the Gulf is still shutdown as part of the preparations to minimize Gustav's damage to the energy facilities if the hurricane were to occur as forecasted.
Oil and commodities including Gold fell on additional news of global economic output falling. Economic slowdown in the America's and Europe will hinder demand for oil and has caused investors to pull out of the commodity and energy sectors around the globe.
In addition to the above, the greenback gained strength versus the euro and other western currencies driving demand for Commodities measures in USD down.
Overall, as energy traders on Tuesday drove down prices via mass exodus of the markets, it is apparent that they are going to keep their eyes on the following tropical storms to come.
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