Dow tumbles as oil prices soar to new highs

Traders said a sharp spike in oil prices was the subject of Wall Street’s earlier losses.

Major US automakers such as General Motors have blamed soaring oil costs for falling sales and the closure of production facilities while big domestic airlines, including American Airlines, have announced layoffs and flight cutbacks due to rising fuel bills.

US stock markets fell heavily in early afternoon trading on Friday after crude oil prices rocketed by almost 10 dollars a barrel to briefly break the 137-dollar barrier for the first time.

The Dow Jones Industrial Average had slumped a hefty 272.76 points (2.16 percent) to 12,331.69 and the tech-dominated Nasdaq composite had dived 46.48 points (1.82 percent) to 2,503.46 at 1736 GMT.

The broad-market Standard & Poor’s 500 indexes retreated 25.62 points (1.82 percent) to 1,378.43.

Traders said a sharp spike in oil prices had added to Wall Street’s earlier losses. Stocks had been weighed down in earlier trading as a government survey revealed a sharp jump in unemployment.

Wall Street’s losses deepened as a key New York oil futures contract rocketed 9.91 dollars to a record 137.70 dollars per barrel before retreating somewhat.

Major US automakers such as General Motors have blamed soaring oil costs for falling sales and the closure of production facilities while big domestic airlines, including American Airlines, have announced layoffs and flight cutbacks due to rising fuel bills.