Stocks Rise as Energy Prices Fall
RENEE MONTAGNE, host:
Time now for business news.
Stock prices are rising thanks to a leveling off of other prices including oil. Yesterday, the Dow Jones industrial average surged 130 points as NPR's Scott Horsley reports.
SCOTT HORSLEY reporting:
The Dow has jumped more than 300 points in the first three days this week, closing yesterday above 10,464. Yesterday's rally came after an encouraging report that showed inflation in check. The Labor Department found no increase in core prices during the month of April. That core measure of inflation does not include volatile food and energy prices, which jumped by half a percentage point last month, but so far this month, energy prices are falling. Oil prices dropped to a three-month low yesterday of $47.25 a barrel. A weekly report from the Energy Department says stockpiles of oil are bulging at near a six-year high. Analyst Phil Flynn of Alaron Trading in Chicago says that cushion, plus a healthy flow of imported oil, have helped to cool off the market.
Mr. PHIL FLYNN (Analyst, Alaron Trading): We have seen oil imports at the fourth highest level ever. It's sort of like the Statue of Liberty is calling for oil from around the world, and it's answering the call. We're getting oil from all over the place. And it's put our oil inventories in the best situation they've been in years.
HORSLEY: Even so, Flynn warns that global supplies of oil remain tight and seasonable demand is likely to pick up.
Mr. FLYNN: We're not using a lot of oil yet. This is the time of year where we're turning off our heaters, we haven't turned on our air conditioners and we really haven't started to enjoy the summer driving season just yet. But obviously the summer driving season is just around the corner. So even though the market may be under a bit more pressure, I think there's a possibility that we could start the rally all over again, and I think the prices could star moving up.
HORSLEY: Even though oil prices have fallen more than $10 a barrel from their peak in early April, they've remained relatively high, about 17 percent higher than at this time last year.
Scott Horsley, NPR News.
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