Price of oil is expected to drop

The price of oil is low and likely headed lower reports the Associated Press. As the stock market experienced turmoil last Monday, the price of a barrel of oil dropped to a price not seen since early 2008.

Holding steady around $90 a barrel this week, the prices which neared $150 midway through the summer now seem to belong to the distant past. As fears surrounding the market for credit continue to grow, oil prices are likely dropping in part because continued growth seems unsustainable, even in Asia’s developing countries.

"The market is finally acknowledging that this credit crisis is a global phenomenon and that will equate to lower world oil demand in the future," Phil Flynn, analyst at Alaron Trading Corp. in Chicago, tells the Associated Press. "People thought the crisis would be contained to the U.S. and we'd see oil demand in China and India continue to grow. Now that just doesn't seem possible."

Though oil prices are falling in large part due to bad economic news, the lower prices do translate into at least a little good news for consumers.

The article reports that according to AAA, the average price of a gallon of gas in the United States is currently about $3.50. Average prices topped out at over $4.10 this past July, so the lower prices should make filling up less painful.

In light of poor stock performance and declining home values, however, the lower gas prices may provide little relief.

Here's the complete article.

--Bridget O'Sullivan

Lock in home heating oil rates now

Before the price of oil rebounds to the highs seen this summer, talk to your heating oil provider to lock in a rate for the winter. Securing a rate early can help save a lot of money if the price of oil goes up over the course of the next few months.

According to a WBZ-TV report, the average price of a gallon of oil in mid-September was around $3.80, but in the first few days of the month, it had reached as high as $4.62.

Even a few cents can make a big difference because of the large amount of oil many homeowners mustbuy to heat their houses each winter.

"It's certainly the lowest we've seen in a few months time," Michael Ferrante, president of the Massachusetts Oilheat Council said to WBZ-TV about the price of home heating oil.

Late September, however, can be a tricky time to buy because of the potential for large swings in the price of oil due to the potential for severe weather such as hurricanes. Concern over damage to oil processing machinery along the Gulf Coast was considered at least partly responsible for the rapid price increases in early September.

In addition, if the dollar weakens due to deteriorating economic conditions, oil becomes a more attractive investment. This increase indemand for oil can in turn drive the price up. Now that the price is at a relative low, it's an ideal time to lock in a rate for the winter.

Check out the deals Consumer United has on home energy here. Also, click here for the WBZ-TV report.

--Bridget O'Sullivan

Oil prices hover around $100 per barrel

There has been no shortage of factors to influence the fluctuating price of a barrel of crude oil lately, but as Wall Street reorganizes prices seem to be reaching a plateau around $100.

The string of hurricanes in the Gulf drove prices up over concerns of damage to infrastructure, but the shaky days on Wall Street pushed prices downward due to fears of stagnant growth in the future.

The New York Times reports that the full extent of the damage from Hurricane Ike and the other storms has not been fully assessed because most oil and natural gas refineries in the affected states have not reopened.

The article also references statements made by the nation's energy department which indicate that oil inventories and stockpiles are declining. This decrease in supply could drive prices up.

In addition, although concerns over future growth can drive the price of oil down, in a very turbulent economy, oil can be seen as a more stableinvestment. As some investors more their money into commodities such as oil,prices are likely to go up. The price of oil is also tied to the strength of the dollar.

If the dollar gains value, investors are less likely to look to commodities. When the dollar is weak compared toother major currencies, commodities become more attractive investments and the price of oil is likely to go up. After reaching more than $140 per barrel during the summer, oil had fallen to around $90 as Wall Street readjusted to the recentrestructuring.

Concerns over hurricane damage, growth and the stability of the dollar all seem to be keeping oil around $100 perbarrel, at least until new information emerges from the financialsector.

Click here for more.

--Bridget O'Sullivan