Crude oil prices dropped by $1/barrel and gasoline prices moved to an 8 week low following the news that BP would be keeping its pipeline open in Prudhoe Bay. While the pipeline will remain open production will be cut back by about half.
Other factors are the cease fire between Hezbollah and Israel, and Royal Dutch Shell begain pumping again in Nigeria through the pipeline that was damaged in July. Also we are nearing the end of traditional driving season which is also good news as demand will ease up as well.
Overall, it looks like a bullet was dodged in regards to oil prices pushing the U.S. and possibly the world economy into a recession. Although people like James Hamilton are predicting lower growth for the remainder of 2006.
