Oil Prices Fall as US 'Fiscal Cliff' Approaches

NEW YORK (AP) - Oil prices fell as much as $2 a barrel Friday as doubts grew about whether political leaders in Washington could reach a deal on the budget before a package of tax hikes and spending cuts automatically kicks in with the new year.

If Republicans and Democrats don't work out a compromise in the next 10 days, the U.S. could go over the so-called "fiscal cliff," a reference to hundreds of billions of dollars in tax increases and government spending cuts that take effect if a budget deal is not reached. Many economists fear that would eventually push the U.S. back into recession, a situation that would likely mean less energy demand.

Benchmark crude for February delivery fell $1.47 to finish at $88.66 per barrel in New York, the contract's lowest point in three weeks. It dropped to $87.96 per barrel at one point Friday.

Late Thursday House Republicans abruptly put off a vote on an alternative plan offered by House Speaker John Boehner that would prevent scheduled tax increases from taking effect on Jan. 1 on all income under $1 million. President Barack Obama wants the cutoff point to be $400,000.

On Friday both signaled that talks are still open.

Brent crude, used to price international varieties of oil, fell $1.23 to end at $108.97 per barrel in London.

In other energy futures trading on the New York Mercantile Exchange:

- Natural gas lost a penny to finish at $3.45 per 1,000 cubic feet.

- Heating oil fell 4 cents to end at $3.02 a gallon.

- Wholesale gasoline fell 2 cents to finish at $2.73 a gallon.

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STAN

Why isn't anyone here blaming guns for the low gas prices??

December 24 2012 at 11:34 AM Report abuse rate up rate down Reply
don917

One days significant drop in oil prices does NOT portend a trend !! To make a mulit-year purchase decision ( like buying a gas guzzler ) based on the current days cost of gas in simply foolish. The long term trends SHOULD BE OBVIOUS, while we have a respite, more efficient cars, more efficient housing, consume less & GET MORE OUT OF WHAT YOU CONSUME !!

December 24 2012 at 9:02 AM Report abuse rate up rate down Reply
Richard

I keep asking, and never get an answer,,,,,,, are the obamacare supporters lining up to pay the $65 (not til 2014)..... or is it that they expect everyone BUT them to pay it?

December 24 2012 at 2:58 AM Report abuse rate up rate down Reply
lawmutt55

All of the Bush tax cuts will expire on 12-31-2012. After the first of the year, the Democrats will pass a tax cut for all but the upper 2 - 3% with Republican votes. Problem solved.

December 24 2012 at 2:52 AM Report abuse rate up rate down Reply
Gina

Here in Detroit, the prices are all over the place. Some stations have it at 3.09, others down the roade were 3.12, down the street a bit further near the freeway it was 3.49! It's very strange right now. Normally the stations are all around a few pennys of each other so for these big jumps in gas prices to be happening, something weird is going on. All the gas stations off the freeways are all gougers and always much higher than the other but this huge price difference was just regular corner gas stations a few blocks from each other. Now that's worth driving a litle further for gas when there's a 40 cent differnce!

December 24 2012 at 2:14 AM Report abuse +2 rate up rate down Reply
obamasafiasco

Obama wants the country to go over the cliff so taxes will go up on everyone. He's counting on it to fund next years Obama family 40 million dollar holiday vacation. Such a shame that so many this holiday season will be going without.

December 24 2012 at 12:26 AM Report abuse -1 rate up rate down Reply
obamasafiasco

Wow Harry Reid wouldn't even bring Obama's fiscal cliff plan up for a vote. That dog gone Harry. He's such an obstructionist.

December 24 2012 at 12:00 AM Report abuse +1 rate up rate down Reply
1 reply to obamasafiasco's comment
mitchnoconnell

Harry told me what's the point? My Republican house is so divided it can't even muster up a vote to preserve the middle class Bush era tax cuts! What a shame my Great Republican Party disinegrating as we speak. Rove and Newt are still trying to figure out why we lost the Presidential election.

December 24 2012 at 12:08 AM Report abuse +3 rate up rate down Reply
1 reply to mitchnoconnell's comment
obamasafiasco

I can tell you why the Republicans lost the election. Republicans should have given out free cell phones and they didn't demonize fellow citizens and attack them for being sucessful. Republicans should have told all Obama's welfare recipients that they would give them more foodstamps and Obama money.

Obama wants ALL tax cuts to expire. Everyone knows how demoncrats love tax increases. And Pelosi made sure that everyone!!! will be paying more taxes to fund Obamascam.

December 24 2012 at 12:19 AM Report abuse -1 rate up rate down
obamasafiasco

Hmm I wonder when the left will go crazy about John Kerry being nominated as secretary of state. He's a billionaire, a tax evader, he's the 1%, he hasn't paid his fair share and he even has overseas accounts!!!

Where's the OUTRAGE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

December 23 2012 at 11:54 PM Report abuse +2 rate up rate down Reply
1 reply to obamasafiasco's comment
mitchnoconnell

Not so fast, first we Republicans have to shove the nation over the cliff, then we will use the Kerry nomination as a side show. We have a lot of flames to fan here in the next few weeks. I bet that ole Kerry has offshore accounts too, like Mitt and myself!!!

December 24 2012 at 12:00 AM Report abuse -2 rate up rate down Reply
1 reply to mitchnoconnell's comment
obamasafiasco

It's Obama who wants the country to go off the cliff. That way taxes will increase on everyone and the demoncrats will have more money to spend and waste.

Obama could care less about the middle class. Obama's wants to get this over so he can start his 40 million dollar holiday vacation compliments of the tax payers.

December 24 2012 at 12:23 AM Report abuse -1 rate up rate down
obamasafiasco

Obama wants the country to go over the cliff so taxes will go up on everyone. You know how those greedy democrats love tax increases.

December 23 2012 at 11:50 PM Report abuse -2 rate up rate down Reply
1 reply to obamasafiasco's comment
mitchnoconnell

No, the President told us just the top 2%, not everyone. We Republicans have decided to let all of the Bush era tax cuts expire for everyone. Grover really has us backed into a corner, so much so we could not even muster up a vote last week in the house. What a shame for the great Republican Party.

December 23 2012 at 11:56 PM Report abuse +3 rate up rate down Reply
1 reply to mitchnoconnell's comment
obamasafiasco

No Obamas wants everyones taxes to go up. If he really wanted the tax rates to be rolled back on the 2% he would have done so when the demoncrats had both houses and the White House. Funny I believe Obama even gave rich guys like himself another tax cut not too long ago.

December 23 2012 at 11:59 PM Report abuse rate up rate down
obamasafiasco

How come the leftwing extremists aren't going after John Kerry for being rich and also being a tax evader, now that he has been nominated for secretary of state. Kerry has more money than Romney. Oh I forgot that's ok if you're a liberal and rich and don't pay your fair share.

December 23 2012 at 11:39 PM Report abuse -2 rate up rate down Reply
1 reply to obamasafiasco's comment
mitchnoconnell

Tell me about it, I wanted McCain to be secretary of state or maybe Bachmann, she could turn it into something like the Crusades and pray every crisis away!

December 23 2012 at 11:45 PM Report abuse +2 rate up rate down Reply
1 reply to mitchnoconnell's comment
obamasafiasco

I bet you lay awake at night worrying that Bachmann will say a prayer for you. LOL

December 23 2012 at 11:47 PM Report abuse -1 rate up rate down