Commodities : Tuesday, Dec. 17, 1985 : Oil Futures Decline Sharply

Petroleum futures prices declined sharply Tuesday on the New York Mercantile Exchange.

Prices for crude oil, heating oil and gasoline opened down the limit established by the exchange for daily trading. After rallying, prices took a nose dive again near the close.

Petroleum came under a lot of selling pressure, said Peter Beutel, an analyst in New York with Rudolf Wolff Energy.

Distillate stocks are high, peaking later in the year than usual and keeping the market on the defensive, he said.

“People also are talking about Mexico going to lower its price, raising the specter of a price war,” Beutel said.

Crude oil was 63 cents to 92 cents lower, the contract for delivery in January at $26.42 a barrel; heating oil was unchanged to 2.15 cents lower, with January at 77.14 cents a gallon.

Silver prices were strongly depressed on the Commodity Exchange in New York. A key factor, said Jack Barbanel, an analyst in New York with Gruntal & Co., was the falling oil markets.

“When crude and heating oil started tumbling, metals started trading off, substantially,” he said.