plus 150,000 troops nearby Sudaam was the last guy I remember saying he wasn't going to trade oil in dollars.
maybe it's already been discussed as this thread is already 7 pages long, but could some of you old guys share some stories of the oil crunch of the 70s and 1980 when oil was at it's highest? the $38/barrel then is equal to $96/101 now. so seeing how we are right around the highest rates ever, is there anything to expect other than just higher prices at the pump? are gas shortages and rationing in the near future?
At this prices I think it is economical to mine for oil shale, but no will do that cause then the big oil companies will just drop the prices, and they would lose money. I think the government needs to do something.
THe high price of oil has a lot to do with the weak doller. This is an old graph, but it gives you an idea. Our currency is dropping in value. The canadian dollar is worth more than the U.S. dollar. Of course the price of oil is going to rise relative to the dollar.
absolutely. the US dollar has depreciated 5-20% in just the past year compared to the british pound, euro, canadian dollar etc. i think that is a huge reason for this. which of course raises the really troubling problem of eventually opec switching to the euro and/or the asian banks doing the same. but lets reduce interest rates. yay.
Stocks Plunge on Profit Reports, Credit Market Jitters By Howard Schneider Washington Post Staff Writer Thursday, November 1, 2007; 4:11 PM http://www.washingtonpost.com/wp-dyn/content/article/2007/11/01/AR2007110100538_pf.html U.S. stocks dropped sharply today as weak reports on corporate performance and new data on consumer spending soured investors just a day after a Federal Reserve Board interest rate cut had buoyed the markets. The Dow Jones industrial average was down more than 360 points shortly before the close, a decline of 2.6 percent. The Nasdaq and the Standard & Poor's 500 index suffered proportionate declines. Renewed credit market jitters hit financial shares, with an analyst report from CIBC World Markets downgrading the outlook for financial giant Citigroup. The report suggested the company may need to sell assets to raise cash. Shares were down around 6.5 percent in early trading. In addition, oil giant Exxon Mobil Corp. reported lower-than-expected profits. The company earned $9.4 billion between July and October, compared to $10.4 billion in the same period a year ago. While a substantial amount of money, the company reported that its profit margin had been trimmed by higher crude oil costs that had not yet been translated into higher prices for gasoline and other products. Also undercutting confidence: An overnight spike in the price of oil triggered by a report that U.S. petroleum reserves had fallen for the second week in a row. The price for light, sweet crude, topped $96 a barrel in overnight trading, as investors surveyed data from the U.S. Energy Information Administration showing that U.S. oil supplies had fallen by 3.9 million barrels last week. Prices began receding when trading opened this morning on the New York Mercantile Exchange. But the negative mood found plenty of reinforcement. New Commerce Department data showed that consumer spending -- a mainstay of the U.S. economy -- grew 0.3 percent in September, slower than expected. And an index of the U.S. manufacturing industry showed that activity at plants and factories slowed in October. The downturn on Wall Street followed a much-anticipated quarter-point cut in interest rates announced by the Federal Reserve yesterday, which helped push the Dow up 137 points. The short-lived rally reemphasized how volatile markets remain, analysts said. Financial companies are still processing the degree to which problems in the mortgage industry and credit markets will hurt their bottom line, oil and commodity prices are raising inflation concerns, and there's anticipation that U.S. economic growth will slow at the end of the year. A report on the gross domestic product [GDP] yesterday estimated that the U.S. economy maintained its momentum in the third quarter of the year, growing at a faster-than-expected 3.9 percent annualized rate. That estimate, however, was based on a level of consumer spending that appears to be slowing, said Nigel Gault, chief U.S. economist with the Global Insight consulting firm. Gault said he expected that a consumer pullback "will slow overall GDP growth to less than 2 percent" as the year ends. "It was consumer spending and foreign economic growth that largely fueled U.S. economic activity this year," said Bernard Baumohl, managing director of the Economic Outlook Group. "If Americans start to cut back on spending and foreign economic growth slows before the housing sector has chance to recover, then this expansion could well be in jeopardy." Art Hogan, chief market analyst at Jefferies & Co., said that the day after a Fed move on interest rates can often be turbulent. "Often times, the day after is a choppy ride because the full extent of the news settles in on us," he said. "We were very excited yesterday about the fact that the Fed cut. That's what we wanted and expected. We celebrated that. But as we sort of wake up today and say, 'Wait a minute, they took the punch bowl away' . . . that takes away the guarantee that we had in this market that they're going to continue to cut" interest rates again. "Layer on top of that the fact that several large corporations like Citi were downgraded, Exxon Mobil had profit-margin issues, Merrill Lynch continuing to look for someone to run the company, the tone of corporate news is more negative than positive today. Coupled with all of that, oil continues to press toward $100," Hogan said. "At some point, we have to wake up and realize that that's not good for corporate earnings."
IMF says dollar ‘overvalued’ By Chris Giles in London Published: October 17 2007 http://www.ft.com/cms/s/0/e87f070e-7c96-11dc-aee2-0000779fd2ac.html Currency traders were given a green light to continue selling the US dollar on Wednesday, as the International Monetary Fund said the greenback “remains overvalued” and rejected claims the euro had risen too far. Contradicting Rodrigo Rato, the outgoing IMF managing director, who last week said “right now the dollar is undervalued”, the fund’s staff conclude the dollar is still too high. The multilateral lender also forecast slower growth in 2008 at 4.75 per cent, compared with 5.2 per cent expected this year. The IMF’s new stance on the dollar will counter the arguments to the contrary made by France and some other eurozone members at this weekend’s meetings of the Group of Seven leading economies and the IMF’s governing body. They have been urging a change in language to temper the fall in the dollar, which dropped by more than 4 per cent against the euro in September alone. The IMF, however, has little sympathy for struggling eurozone exporters hit by the currency’s rise. It says that even after its recent rise, the euro “continues to trade in a range broadly consistent with medium-term fundamentals”. Apart from the dollar, the IMF’s economists also think sterling is overvalued, while the Japanese yen and the Chinese renmimbi remain too cheap compared with other currencies. In some of its strongest language to date, the fund’s officials call on China to let its currency appreciate. Repeating its demand for “greater flexibility” of China’s managed currency, the IMF added that such action was in China’s best interests. “Further upward flexibility of the renminbi, along with measures to reform the exchange rate regime and boost consumption, would also contribute to a necessary rebalancing of demand and to an orderly unwinding of global imbalances,” the World Economic Outlook argued. Even with slower growth forecast for the US and a weaker dollar, the IMF sees little improvement in the world’s huge trade imbalances, embodied in the US trade deficit and corresponding surpluses in Asia and in oil exporters. The Fund thinks that the US current account deficit will remain close to 1.5 per cent of world output until 2012, raising the likelihood of a disorderly plunge in the dollar and protectionism growing over the next few years.
The winter comes, yeah, the price goes up; The rain comes, yeah, the price has to go up; Iran prez opens his mouth, yeah, the price gotta rise; China has holiday, hell yeah, price needs to go up; ............... I just broke wind, gosh, the price will shoot through the roof !
