Oil Prices Stay Low Despite Plans for Chinese Stimulas Package
NEW YORK --- Oil prices didn't shift much today, as demand concerns continued to weigh on investors' minds despite announced plans for a stimulus package from the Chinese government, CNNMoney.com reported.
Oil prices rose $4.52 a barrel early in the session. But by midday Monday, U.S. crude for December delivery had gained a modest 71 cents to $61.75 a barrel.
Over the weekend, China said it was introducing a $586 billion stimulus package aimed at shielding its economy from the global recession.
While the plan is "very constructive long-term, we won't start to see the effects of that stimulus until late in the first quarter, early second quarter [of 2009]," Brian Hicks, fund co-manager at U.S. Global Investors in Texas, told CNNMoney.com
A surge in Chinese economic growth, combined with growing oil demand from the fourth-largest economy, led to a rally in oil prices that culminated with a record high of $147.27 a barrel in mid-July. But investors' hopes that China's 1.3 billion citizens and rapidly expanding economy would continue driving oil demand fizzled as the global financial crisis deepened, CNNMoney.com reported.