Oil's biggest day yet drags down stocks - Yahoo! News

News Type: Event — Seeded on Sat Jun 7, 2008 6:05 AM EDT

Article Source: Yahoo! News

business, oil, market, price, gasoline, high, crude

NEW YORK - Oil prices made their biggest single-day leap ever Friday, dragging the Dow Jones industrials down nearly 400 points and raising the once-unthinkable prospect of $150 oil and more record gas prices by the Fourth of July.
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The meteoric rise of nearly $11 for the day piled atop an increase of almost $5.50 the day before, taking oil futures more than 13 percent higher in just two days, easily a record on the New York Mercantile Exchange.

And those weren't the only stunning numbers of the day: The government also reported the nation's unemployment rate zoomed to 5.5 percent in May, a monthly rise of half a percentage point, the biggest in 22 years.

Oil settled at $138.54, a rise of more than 8 percent. The surged came after Morgan Stanley analyst Ole Slorer predicted strong demand in Asia and tight supplies in the Western Hemisphere could drive prices to $150 by Independence Day, when millions of Americans take to the roads.

That means no end in sight for spiraling gas prices, already above $4 per gallon in much of the country.

Even longtime market observers were shocked by the magnitude and speed of oil's rally.

"We're ... somewhat off the map as far as historical precedents are concerned," said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates in Galena, Ill.

Besides the jump in the unemployment rate, the Labor Department said employers had cut 49,000 jobs in May, the fifth straight month of nationwide losses. Job losses for the year reached 324,000.

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Scott Isaacs

I suspected that oil would rally higher and higher even when analysts said recently that the oil price was a bubble... looks like that may be coming true.

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1 vote

#1 - Sat Jun 7, 2008 6:07 AM EDT

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Gas pushes above $4, oil falls on Paulson comments	Associated Press	Mon Jun 2	2
Crude Oil Advances on Weakening Dollar, Morgan Stanley Outlook	Bloomberg.com	Fri Jun 6	1
Oil's 2-day surge tests record	CNN	Fri Jun 6	0
Dismal numbers — oil up, jobs, stocks down; recession feared	mcclatchydc.com	Sat Jun 7	5
Stocks finish widely mixed after Friday's sell-off	Associated Press	Tue Jun 3	0

SCOTT ISAACS

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Oil's biggest day yet drags down stocks - Yahoo! News

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