Predictions that the price of oil would continue to rise steadily throughout the month have been quashed already following more than ten per cent of the oil price being cut yesterday (December 7th).
The drop in value of US light sweet crude from $46.58 to just $42.63 - a decline of $5.95 in one day - is a result of an announcement regarding the US stocks of oil which puts the US stocks far above the figure predicted.
US stocks had risen by 6.7 million barrels, the Energy Information Agency said, a far higher rise than the 1.5 million barrels it was expected to rise by.
Such a vast amount of oil has suppressed prices even in the face of violence in the Middle East and concerns over Russian supplies.
"This has been a speculatively led rally here in the past couple of weeks," said Jim Ritterbusch of energy consultants Ritterbusch and Associates.
"It didn't have a lot of fundamental impetus behind it, and now we're getting evidence that there's a lot more crude and product supply out there than what we thought."
Supply chain managers will no doubt welcome the low prices but the weak pound puts companies at risk of rising prices.
A supply chain management company could help a business reduce the risk it faces from rising oil prices.
Manufacturing and Industrial:
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