Monday, Oct 29, 2007
No profit taking this week then, $100 is only a matter of time now (WE ARE DOOMED!)
USA Today: Oil sets record, surpasses $93 a barrel
SINGAPORE (AP) — Oil prices rose above $93 a barrel to a new trading high in Asia Monday on growing political tensions in the Middle East, a weak dollar and worries about the supply outlook ahead of the winter.
"The strong price is due to supply concerns in general, on top of which we have the geopolitical news," said Victor Shum, a Singapore-based energy analyst with Purvin & Gertz.
Posted by planning4acrash @ 08:46 AM (1176 views) Add Comment
20 Comments
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1. sovietuk said...
Just a minute dosen't this mean everything gets more expensive. Oh dear no room for reducing interest rates then. Infact quite the opposite.
2. tyrellcorporation said...
I agree, this is great news as it pretty much nobbles the idea of IR cuts in the short and medium terms.
The Perfect Storm!
3. Mark said...
the updates of news articles and comments are too slow on this site..
4. Lierbag said...
With supply so tight - and global inventory so low - it seems these days it only takes somebody to sneeze in one of the world's oil producing regions for prices to go through the roof. This is the new way of things. And it's a permanent state of affairs. Interestingly, even with oil at its present historically high price, the Saudis are unwilling to boost production. Draw your own conclusions.
5. planning4acrash said...
Its BAD news, we can excape domstically induced inflation from higher interest rates, but are doomed to stagflation if we are fighting against global inflation. Its like swimming against a rip tide.
6. Onyerhike said...
Don't be silly - this won't cause inflation. My car runs on dvd players and champagne.
7. Stoatgobbler said...
But equities keep rising. That really is insane. It's going to be the mother of all messes shortly, and yup, there will be a crash in property, but mainly because unemployment goes back to 12%. The US consumer is showing us the future, and it's very ugly indeed. Cash it in now...
8. The Reaper said...
the oil price is, a to a degree a function of the weakening dollar.As long as sterling holds up we'll be fine.And that's likely with our healthy fiscal/current account supluses
9. Cheekie Charlie said...
As TyrrelCorporation points out "In defence of currency" If IR are lowered in this country the pound will be history and inflation will go into double figures! Will this reignite HPI? No. In the real world real wages have been stagnant for the last 10 years peoples wealth or illusion of wealth has come from HPI. High inflation will make the HPC alot worse. Will wages increase with inflation? Maybe but so will unemployment. Enjoy the war the peace will be terrible.
10. whiteknight said...
stagflation is a given.
11. whiteknight said...
The only way to escape is to become radically more productive and efficient. This is the natural process that stagflation will enforce, but it can take decades.
Occasionally there are othe options - but they are rarely taken - as its a change in the people that is the requirement.
12. sovietuk said...
"The only way to escape is to become radically more productive and efficient"
10 years ago there was a glimmer of hope, now it's like being stuck in a pot of glue.
13. mrmickey said...
Yes I think high oil prices will kill off the welfare state, there just won't be enough fat left in the economy to support the millions of economically unproductive people that exist in the UK.
14. C'mon Correction said...
spot on mrmickey.
15. Afrobaggie said...
I don't understand why stagflation is a given, and not recession slipping into depression? Then again I am an Engineer and not an Economist.
16. maddison said...
The UK is fairly oil neutral ie we export a fair amount of oil and some of the worlds biggest oil companies pay UK taxes. It all rests on what happens in the US if it is tipped into a major recession then we will have problems and so will the Chinese.....
17. stillthinking said...
Why won't high interest rates lower the price of oil in sterling? Surely high interest rates suck money out of the economy, so the money left is worth more irrespective of whether buying something internally or externally.
I don't think interest rates will be raised appropriately, but if they were then they do compensate for global inflation. ??
18. mrmickey said...
Another thought, if oil prices go higher won't this strengthen Sterling due to our North Sea oil reserves and therefore make our exports even more expensive. This could explain part of the reason why industry in this country has been going down the tubes since the discovery of North Sea oil, it keeps Sterling artificially strong and we become more reliant on oil exports to keep us going a bit like Iran.
19. maddison said...
High oil prices also take demand out of the economy ie people feel worse off if they are having to pay alot at the pumps - funnily enough people don't drive less.... the effect of this is to actually slow the economy and can actually lower inflation. Of course the input price for industry goes up which has the opposite effect.
20. planning4acrash said...
http://news.yahoo.com/s/ap/20071029/ap_on_bi_ge/oil_prices_24
Light, sweet crude for December rose $1.67 to settle at a record $93.53 a barrel on the New York Mercantile Exchange after rising as high as $93.80 earlier, a trading record. Crude prices are closing in on the inflation-adjusted highs hit in early 1980. Depending on the how the adjustment is calculated, $38 a barrel then would be worth $96 to $101 or more today.