Global Warming Seen Effecting Oil Price Volatility
Record-breaking temperatures in the U.S. and Europe are reducing fuel demand and contributing to the biggest fluctuations in oil in more than a year. Wall Street has never been more divided on the direction of crude, adding to price swings.
Oil is down from a record $78.40 a barrel in July, when forecasters said hurricanes made stronger by climate change may tear up Gulf of Mexico production plants. Crude dropped 7.8 percent to $56.31 a barrel last week as New York City broke a 129- year record for making it this far into winter without snow. The U.K. said 2007 may be the warmest year ever.
"The bulls have been bowled over by the weather," said Adam Sieminski, the chief energy economist at Deutsche Bank AG in New York, who forecasts an average of $62 oil for 2007. He said recent mild temperatures stem from a cyclical El Nino weather pattern and to a lesser extent from global warming.
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