The benchmark price for U.S. crude oil dropped below $80 a barrel a few weeks ago, the lowest level since June 2012. Given the turmoil in the Middle East, the typical market response would be rising prices to compensate for expected supply shortfalls.
The falling price indicates that concern over faltering demand — weakness in the global economy — dominates market psychology. If those prices remain low, the implications will be felt around the world.
Oil prices topped $115 a barrel in June amid concerns over a supply shortfall as the global economy regained its feet. Production increased as suppliers sought to take advantage of high prices and earn revenues.