Shortages of oil could have resulted if Iran closed the Strait of Hormuz, through which one-fifth of exported oil travels, as a result of sanctions due to the country's nuclear policies. The price of oil stayed near $100 throughout January because of concerns over supplies, and the European debt situation. The average price of gas was $3.38 on January 20, up 17 cents from a month earlier. Another factor was planned closing of refineries in the U.S. and Europe due to lower demand. By early February, the national average was $3.48, though oil prices were at $98, the lowest in six weeks, and U.S. demand was the lowest since September 2001. On February 20, benchmark March crude oil reached $105.21, the highest in nine months. This came one day after Iran's oil ministry announced an end to sales to British and French companies; though this would have little actual impact on supplies, fears resulted in higher prices. Also, approval of the bailout plan for Greece was expected, and China's action to raise the money supply was likely to stimulate the economy. Brent crude was up 11 percent for the year to $119.58 on February 17, with cold weather in Europe and higher Third World demand, and West Texas Intermediate crude was up 19 percent to $103.24. The average price of gas was $3.53. On February 29, the average was $3.73. The average peaked at $3.94 early in April, and on April 24, it was $3.85 compared to $3.86 a year earlier; it had been two years since gas prices were lower than the previous year. Crude oil prices were down; West Texas Intermediate was $103.55 a barrel, down from over $107 late in March, and Brent Crude $118.16 after peaking above $128 in March. On May 7, benchmark U.S. crude reached $95.34, the lowest price of the year, after voters in France and Greece ousted government officials who would cut spending to solve the debt crisis. Benchmark oil in New York actually rose for two days straight early in June, to $84.29. With U.S. oil supplies the highest since 1990, gas reached $3.57 on June 5. After falling again to its lowest price since October 2011, Benchmark crude rose 5.8 percent to $82.18 on June 29, with Brent crude up 4.5 percent to $95.51. European bailout efforts included lending money to banks, decreasing likelihood of failures. Also, European countries decided not to buy Iranian oil. The price of gas was $3.35, the lowest since January 6. On July 17, Benchmark Crude reached $89.22 and Brent crude $104 after good economic news in the United States. Gas rose to $3.40.
On August 7, a California refinery fire contributed to a jump in oil futures. Other refinery problems, a pipeline leak, fears about Iran, the crisis in Syria, North Sea problems, and Tropical Storm Ernesto all contributed to a 20 percent jump in oil prices in six weeks. The price of gas reached $3.63 but was not expected to go much higher. Good economic news in the United States contributed to oil reaching its highest price since May on August 17, with Benchmark Crude reaching $96.01, while Brent crude fell slightly to $113.71.
Early in September, a mix of bad economic news from the United States and good economic news from Europe caused the price of oil to fall slightly. On September 4, Benchmark Crude reached $95.41, with Brent crude at $114.84. The price of gas went down slightly to $3.82 but was still the highest ever for Labor Day weekend. Hurricane Isaac contributed to a temporary spike in gas prices, but on September 12 gas once again rose, to $3.86, as refineries cut production prior to the switch from summer blend gasoline to winter blend. Benchmark Crude also reached its highest level since early May and continued to rise above $99 after Federal Reserve announcements of actions to improve the economy and the 2012 diplomatic missions attacks. Brent crude rose slightly to nearly $116. Early in October, the average gas price was $3.78 and falling, though still a record for the month. Late in the month, the average reached $3.62 after a 13-cent drop in a week, the most since November 2008. Brent crude was down $8 in the previous month. By the start of November, the average was $3.54, partly due to lower demand after Hurricane Sandy. Crude oil futures fell after Barack Obama was re-elected November 6. After Thanksgiving, lower U.S. oil inventories, good economic news in the United States and good news relating to the Greek bailout helped push Brent crude up to $111.04, and benchmark oil for January delivery to $87.92; benchmark oil reached $86.24 on November 28, and gas was $3.41.
On December 13, Brent crude was down to $109.20, while benchmark oil fell slightly due to U.S. fiscal cliff concerns and rose due to Federal Reserve efforts to help the U.S. economy, ending the day at $86.77. In mid-December, gas prices reached $3.25, the lowest for 2012. Oil was trading for between $84 and $90.
Read more about this topic: World Oil Market Chronology From 2003
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