Oil Prices Fall Below $48 a Barrel

Oil Prices Fall Below $48 a Barrel

Oil prices made an about face Friday, falling below $48 a barrel, as tensions between U.S. forces and rebel fighters in Iraq eased, raising hopes that attacks against the country's oil infrastructure would subside.

U.S. light crude for September delivery dropped 84 cents to settle at $47.86 on the New York Mercantile Exchange, retreating from Thursday's record closing price of $48.70.

Crude futures have soared more than 50 percent in the past year, although when adjusted for inflation, oil is still roughly $9 less per barrel than it was leading up to the first Gulf War.

With worldwide supply cushion razor thin at a time of robust demand, traders said oil markets would remain on edge for some time.

However, the prospect of an end to the 2-week-old anti-U.S. uprising in Iraq gave reason for oil markets to take a breather from a rally that has caused prices to rise by about 30 percent in the past six weeks.

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