Tuesday, Dec 05, 2006

Interesting twist...

BBC: Weak dollar makes Opec cut likely

The weakening dollar is increasing the chances of a cut in output by oil producers' group Opec at its next meeting later this month.
On Monday the dollar hit a 20-month low against both the euro and the pound, denting the revenues of oil exporters which sell the commodity in dollars.

Higher oil prices creates inflationary pressure which can lead to higher IRs which increases the likelihood of economic slowdown which reduces the value of the Dollar which may lead to further oil production cuts...Sounds like a vicious cycle - potentially.

Posted by tyrellcorporation @ 09:07 AM (2818 views)
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4 Comments

1. waitingfor hpc said...

Great bring it on.

Tuesday, December 5, 2006 09:18AM Report Comment
 

2. Jake The Muss said...

Tyrell - "Higher oil prices creates inflationary pressure which can lead to higher IRs" - That's actually incorrect, lowering oil prices creates inflationary easing but increasing oil prices have virtually no effect on inflation.

Tuesday, December 5, 2006 10:49AM Report Comment
 

3. paul said...

David "Turnip" Smith will be shouting "CONSPIRACY! OPEC are out to get us all!" (still waiting on his $40 per barrel prediction!!)

Tuesday, December 5, 2006 12:24PM Report Comment
 

4. inbreda said...

That is funny. Puts further pressure on the use of the dollar as a global standard as well. I feel another spiral in the making

Tuesday, December 5, 2006 03:56PM Report Comment
 

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