Since peaking on May 1, the Dow Jones Industrial Average
News today that U.S. oil demand had increased 2.2% along with a 1.2% uptick in gasoline use over the last week helped momentarily stem the drop in oil prices, but the day's drop continued, down over 1% as of this writing. Crude inventories also rose by 2.1 million barrels, remaining at 22-year highs.
Worries about a global recession have helped drive down oil prices over the last two weeks. Spain and the U.K. slipped back into recession, and the instability of Greece following an inconclusive election has driven concerns over the future of the eurozone.
A concerted effort by OPEC also appears to have brought prices down, as has calming tensions with Iran as Tehran agreed last month to discuss its controversial nuclear program.
Lower oil prices have translated into lower gasoline prices, with the average price for a gallon at the pump dropping from $3.89 a month ago to $3.73. The summer driving season is also starting to look like it may be less painful as the Energy Information Administration revised its price forecast for a gallon between now and September to $3.79 from $3.95. The lower gas prices should be a boon to consumers and retail stocks over the next few months.
Meanwhile, as oil has slumped, natural gas has gone through the roof, gaining 5% today to $2.60/MMBtu and 30% since it bottomed out about a month ago. Shares of United States Natural Gas
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Fool contributor Jeremy Bowman holds no positions in the companies in this article. Motley Fool newsletter services have recommended buying shares of ExxonMobil. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.