Oil $80

September 12th, 2007

Think of $60 as the gateway to $40 on the downside and $80 as the gateway to $100 on the upside.

There’s a bit of a perfect storm coming together here with very tight inventories and the collapsing dollar.

Via: Yahoo:

Oil futures prices rose sharply Wednesday, briefly climbing above a record $80 a barrel after the government reported a surprisingly large drop in crude inventories and declines in gasoline supplies and refinery activity.

The report from the Energy Department’s Energy Information Administration suggested oil supplies are tightening as demand remains strong. That’s why oil prices are rising despite OPEC’s decision on Tuesday to boost crude production by 500,000 barrels per day this fall, analysts said.

Despite Wednesday’s jump, oil is still well below inflation-adjusted highs hit in early 1980. Depending on the adjustment, a $38 barrel of oil in 1980 would be worth $96 to $101 or more today.

Posted in Economy | Top Of Page

One Response to “Oil $80”

  1. bloodnok says:
    September 13, 2007 at 1:15 am

    On top of any supply-demand and sabotage situations you have the fact that the USD is declining in value, therefore oil producers try to raise the price to protect their purchasing power.

    Here is a chart of West Texas Intermediate Crude in NZD, to get a better picture of where our petrol prices are headed:

    http://www.trending123.com/stocktable/stocks.pl?action=stockdetail&symbol=$WTIC:$NZD

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