Oil prices plunged Tuesday, falling to within sight of $100 a barrel a day after Hurricane Gustav tore through the Gulf of Mexico but appeared to spare oil and gas installations of massive damage. Light, sweet crude for October delivery fell $7.73 to $107.73 a barrel on the New York Mercantile Exchange, after earlier dropping as low as $105.46. The last time prices hovered in that range was in early April before a historic run-up above $147 per barrel. Earlier in the session prices had dropped as low as $105.46. On Friday, the contract settled at $115.46 a barrel as Gustav approached the US Gulf coast, a key region for oil drilling and refining. But traders were relieved that Gustav weakened as it neared the offshore oil rigs and Louisiana refineries, and appeared to have caused less damage than expected in New Orleans and surrounding areas. As Hurricane Gustav dissipated, traders quickly turned their attention to slowing global economic growth, speculating that demand for crude will be dampened even in rapidly expanding China and India. “The market continues to be weighed down by worries of a global economic downturn and slowing oil demand in developing markets,” said Victor Shum, an energy analyst with consultancy Purvin and Gertz in Singapore.
