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martinz
Grandmaster Poster
Joined: 01 Oct 2007
Posts: 287
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 Posted: Fri Mar 28, 2008 2:32 am Post subject: Oil prices soared above $108 |
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Am not sure if this is indeed worrying, oil prices has went above $108 a barrel after one of Iraq's main export pipelines was blown up. What we are experiencing here in Singapore is ever increasing pump rises. I used to fill my tank just under $40 few years ago and I need to pay more than double now.
On the other hand, Gold prices rose as high as $954.50 an ounce, and according to what I know, people buy gold for reasons to safekeep investments. Wonder if there is anybody here good in economics that is able to explain this phenomena ? Thanks in advance. |
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exsanguination
Forum Regular
Joined: 27 Apr 2005
Posts: 418
Location: Australia
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| Posted: Thu Apr 17, 2008 9:14 pm Post subject: Re: Oil prices soared above $108 |
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| martinz wrote: | Am not sure if this is indeed worrying, oil prices has went above $108 a barrel after one of Iraq's main export pipelines was blown up. What we are experiencing here in Singapore is ever increasing pump rises. I used to fill my tank just under $40 few years ago and I need to pay more than double now.
On the other hand, Gold prices rose as high as $954.50 an ounce, and according to what I know, people buy gold for reasons to safekeep investments. Wonder if there is anybody here good in economics that is able to explain this phenomena ? Thanks in advance. |
I'm by no means an expert on any of this but i think its a case of supply and demand. Losing some of the production capacity will make a jump in the price because they simply will have less to satisfy demand, so the cost goes up accordingly.
Oil is a limited reserve, and estimates are that peak oil has already hit (around 2006), or will in about 2010. Its not going to get any cheaper, then general trend since 1999 has been up - have a look there have been drops in prices but overall its getting higher http://upload.wikimedia.org/wi.....m_Term.png
Oh and the US Dollar continues to go down the toilet and it will continue to be compounded by rising oil prices.
But I'm by no means an economist  |
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krt
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Joined: 11 Jan 2005
Posts: 4709
Location: Down Under
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| Posted: Fri Apr 18, 2008 12:56 am Post subject: |
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That's fairly accurate exsanguination. Increasing concerns about the US's own supply have also pushed prices up.
But I'm no economist either, and I ride my bike around too much to care about petrol prices, let alone the economical theory behind the changing prices. |
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Necromis
Lifeless on my Boat
Joined: 11 Apr 2005
Posts: 767
Location: USA
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| Posted: Fri Apr 18, 2008 10:23 am Post subject: |
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| plus the comodities market is a speclative market, meaning that people can assume something is going to happen and drive the price up. I honestly think having oil be something traded is foolish, it only leads to this type of increase. Though some economists are forcasting a "bursting of the bubble" and seeing barrels of oil as low as 35USD. |
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