Oil closes at record high of $104.52/barrel, surges higher today

Yesterday, two pieces of news conspired to push the price of crude oil to new heights. The first is that U.S. oil inventories aren't as robust as everyone thought, and the second is that OPEC, the Organization of the Petroleum Exporting Countries, decided not to increase production of their black gold, Texas Tea. With these two nuggets of bad news, oil futures climbed $5/barrel yesterday, peaking at $104.95 before closing at $104.52. Even when adjusting for inflation, yesterday's closing price beats the previous $103.76 ($39.50 at the time) record set in April 1980 during the second oil crisis. This was all on the evening news yesterday, so you may have heard your favorite network news anchor get really funky with his inflection talking about it.
That was yesterday. Today things got worse, with the price of crude sky rocketing up to $105.97 per barrel, nearly 106 bucks (!), early in the trading session. Why the panicking? Apparently there was an explosion in New York City at Times Square this morning, and before anyone knew what had actually happened, fear of the unknown pushed prices higher. It turns out that the explosion wasn't that big, no one was injured, and it doesn't appear to be a terrorist attack of any sort, and thus the price of oil has since fallen back to a more palatable but still tough to swallow $104.11 per barrel. For some perspective, we found this post written in October 2005 about the price of oil hitting a 2-month low: $61.36 a barrel.

[Source: MarketWatch, Photo by ADEK BERRY/AFP/Getty]

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