Natural gas may help US oil demands

Cheaper and cleaner than any other fossil fuels, and in vast quantities available right in the US territory, natural gas maybe the answer to the oil needs of the US. How would natural gas help the ailing economy of US? Would this really help?



"Imagine if tomorrow you could announce a new energy plan that would in one stroke cut your constituent’s gasoline bill in half, reduce oil imports, improve our air quality, enhance national security, strengthen the dollar, reduce greenhouse gas emission and create tens of thousands of new jobs in the US,” McClendon told Congress last week.

All you have to do is encourage the use of natural gas (in compressed form, known as CNG) for transportation, he said.

"It's a trifecta, triple play and hat trick all rolled into one," he added. "It's actually very easy." Watch his interview on CNBC below.

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Oil Falls on weak economic reports

US economy is still on the brink of sinking but some economic analysts see a slow growth of its economic endeavor. Generally, it is still doing its share to recover from economic pressures. The price of oil , on its contining slide maybe unlikely a savior for US economy.



"That's the problem with that kind of tax stimulus," said Tom Higgins, chief economist at Los-Angeles-based Payden & Rygel. "It only has a short-term impact. It doesn't impact the economy in a lasting way." But a sustained drop in gas prices would help in the long term.

"The real key to everything going on is inflation," said Ron Ianieri, chief market strategist at Options University. "What they're concerned about is the fact that I just drove down to the gas station and this week cost me less than the last eight weeks."

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Oil Price Records Historical Biggest Decline

Historically, some analysts said that the latest $9 decline in oil price is said to be the biggest decline for 17 years of oil trading. The decline was due to snailed-pace US economy as it reportedly needs to lower its oil demand from the world oil markets.

The drop in oil was the largest single-day slide in dollar terms since Jan. 17, 1991, when oil fell by $10.56. On that day, President George H.W. Bush withdrew oil from the Strategic Petroleum Reserve ahead of the first Gulf War.

But in 1991, oil was trading at just $32 a barrel, so the more than $10 slide in dollar terms represented a record 33% drop. Oil fell 4.4% Tuesday, which does not even crack the top 100 price declines in percentage terms.

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US Market Drops As Oil Price Bounce Higher

US investors are once again uneasy on the current trend of US stocks, as it earlier recorded a drop due to the soaring oil prices. Oil price on Wednesday traded at $138.30 a barrel on the New York Mercantile Exchange. Would this mean another economic slowdown for US?

“There are not a lot of positive things you can point to right now,” said Michael Binger, portfolio manager at Thrivent Investment Management in Minneapolis. “We have commodity prices higher, inflation up, the prospect of the Fed raising interest rates instead of lowering, a worldwide slowdown and an economic slowdown in the U.S.”

Mr. Binger said that one weak spot on Wall Street — the financial sector — was faced with a new worry of higher interest rates while still trying to navigate a tight credit market and fallout from bad bets on home loans.

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Oil nears $91 amids plan to revive US economy

Despite actions from the White House and US Congress, one of those is the stimulus package plan, the oil price is still at its feet, standing proudly with remarkable high tags. Was the plan not enough to pull down the price of oil? US is among the top energy consumers in the world, it is evident that US is the most affected of oil crisis.

U.S. oil had traded as high as $91.38 a barrel earlier as the stimulus plan announced by U.S. legislators and the White House Thursday helped lift global stock indexes and countered mildly bearish U.S. weekly oil inventory data.

"This is all about the stimulus package," said Phil Flynn, analyst at Alaron Trading in Chicago. "Oil markets are taking their cue from the stock market."

Prices gave up some of the gains later Friday as U.S. stocks fell on talk of more trouble in the global financial sector and declines in defensive shares offset strong earnings from companies.

U.S. oil has tumbled from a record over $100 a barrel struck Jan. 3 on growing fears crude demand growth could be hit if the subprime mortgage crisis knocks the U.S. economy into recession.

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