Oil Prices Dropped As Gustav Didn't Destroy Gulf Infrastructure

Oil futures plunged to $105.46 a barrel came after early reports showed Hurricane Gustav had spared major US oil infrastructure along the Gulf Coast. But with other storms forming outside the Gulf, oil prices cut their losses.

US government bonds rose as crude's steep slide helped ease inflation worries. Euro zone government debt fell. Weak economic data also contributed to the price rise, which drove yields to recent lows.