Thursday, January 3, 2008
Oil price at record $100 a barrel.
This week oil has finally tipped over the $100 a barrel mark. This time last year it was around $55 a barrel. When are we going to wake up to the fact that we need to find a fast replacement for oil and indeed ALL fossil fuels.
China's rapid industrialisation means there are now a few more Billion people who want oil, and they want it in VAST quantities. For the rest of us, this means paying the oil companies more when we fill up our cars. It means food bills will be on the rise, since the cost of transportation will be passed on to the consumer - YOU.
The BBC website had this to say:
There are those who believe that oil prices can rise significantly higher.
While daily price rises have been blamed on unrest in oil-supplying countries such as Nigeria, an underlying and significant factor has been an increase in demand from China and India.
"$100 is just the beginning," said Zachary Oxman, senior trader at Wisdom Financial in California.
"This is kicking off what you are going to see this year. There will be huge moves up in gold and huge moves up in crude."
Central banks such as the Bank of England and the Federal Reserve are worried that rising oil prices will prevent them cutting interest rates.
Expensive oil increases inflation, which makes it more difficult to make the rate cuts that the central banks may have to implement to boost growth.