The price of oil was trading a bit lower again Tuesday after suffering days of declines, as traders digested the ramifications of new bailout measures amid the continued weak economy.
Crude oil futures ended down $2.56 at $78.63 on the Nymex, but that wasn't as precipitous a fall as many of the daily declines have been lately.
“Confidence has been so awful,” said Douglas Smith, chief economist, for the Americas, at Standard Chartered Bank. “The markets are happy the government is finally coming out with a holistic approach to this whole problem instead of doing little pieces here and there.”
Earlier Tuesday Treasury Secretary Henry Paulson and the Federal Reserve Chairman Ben Bernanke outlined plans to purchase equity in banks to persuade banks to begin lending at reasonable rates again by shoring up their balance sheets.
The moves by the government had a positive effect on oil initially, though the rally lost momentum as the session went on.
Other energy stocks ended lower as well. Nymex RBOB gasoline settled down 3.28 cents, or 1.7%, at $1.8848 a gallon. November heating oil settled down 3.5%, or 8.13 cents, at $2.2597 a gallon.
The dollar was down on the day, with the euro at $1.3687 from $1.3585 late Monday. One greenback was fetching 101.67 yen from 101.97 yen, according to EBS. The British pound was up to $1.7476 from $1.7356, and the dollar was valued at 1.1323 Swiss francs, from 1.1379 Swiss francs late Monday.
December gold futures on the Comex division of the Nymex declined $3 to $839.50 an ounce.
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