Van's Hardware Journal

NEW YORK (AP) - Oil prices tumbled below $34 Thursday, closing in on five-year lows as employment claims rose and OPEC cut demand expectations for 2009.

"The bull oil era is officially over," said Phil Flynn, an analyst at Alaron Trading Corp.

Light, sweet crude for February delivery fell more than 10 percent, or $3.87, to $33.41 a barrel Thursday on the New York Mercantile Exchange. At one point prices fell as low as $33.20.

Crude prices have fallen so fast, the cost for retail gasoline has yet to catch up. Pump prices nudged up again overnight, but is likely to fall.

An oil industry report Thursday showed just how much energy use eroded over the past year.

For all of 2008, U.S. petroleum deliveries—a measure of demand—fell 6 percent to 19.4 million barrels a day, with declines for all major products made from crude, according to the American Petroleum Institute.

That trend appears to be ongoing this year, with millions now out of work and bad jobs data continuing to roll in.

The Labor Department reported first-time requests for unemployment insurance jumped to a seasonally adjusted 524,000 in the week ending Jan. 10. Analysts had expected 500,000 new claims.

An analyst with the Labor Department said the increase is partly due to a flood of requests from newly laid off people who delayed filing claims over the holidays.

# posted by Van Smith @ 3:49 PM