BREAKING: Oil reaches all time high of $80/barrel
The price of a barrel of oil hit a record intra-day trading high of $80.05. It hit $80.18 in intra-day trading on Globex. That's more than a dollar higher than the old record of $78.77 set August 1. The price of oil is up on worries of supply shortages after a Energy Information Administration report said crude stocks dropped 7.1 M barrels when the market expected a drop of 2.1 M barrels. However, EIA does say crude inventories is above the average for this time of year. Also, OPEC said they would raise production by 500,000 barrels.
[Source: CNN]
Reader Comments (Page 1 of 1)
Kardax 5:11PM (9/12/2007)
Adjusted for inflation, we're still a bit away from the all-time high of $84.73 from March of 1981.
The good news is this makes alternative vehicles more attractive. The bad news is it hurts the economy, making alternative vehicles harder to pay for.
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Lascelles Linton 7:47PM (9/12/2007)
"The price of oil and inflation are often seen as being connected in a cause and effect relationship. As oil prices move up or down, inflation follows in the same direction. The reason why this happens is that oil is a major input in the economy - it is used in critical activities such as fueling transportation and heating homes - and if input costs rise, so should the cost of end products."
http://www.investopedia.com/ask/answers/06/oilpricesinflation.asp
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Joseph 7:49PM (9/12/2007)
Hmm...Gas prices at the pump have gone down, yet the price of a barrel of oil have come up. But I don't know what to make of it...
Does that spell out conspiracy?
Or does that mean there isn't any "gas gouging" conspiracy?
There'll be some crazy study coming out about this eventually. :)
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Whoa! 7:33PM (9/12/2007)
One hundred dollars! Do I hear one hundred? Going..
going....sold!!!!!
(Coming soon to a trading floor near you)
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mike 7:40PM (9/12/2007)
I'm noticing a big switch to "VALUE" ( low cost ) cars, to offset the price of gas and those CORE inflation rates.
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Lascelles Linton 7:51PM (9/12/2007)
Joseph, Gas at the pump will go up because of this. There was a study about gas prices for last year.
http://www.autobloggreen.com/2007/09/02/why-gas-prices-went-up-in-2006/
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frank78 11:24PM (9/12/2007)
Conspiracy-um no. Our refineries had produced a glut of gasoline a couple months ago, so the price of gas at the pump is lagging the oil per barrel increase. Another cause of oil going up- the dollar devaluation. The dollar hit a record low against the euro today. Higher inflation is on its way. That will bring the price of oil higher.
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zamafir 12:04AM (9/13/2007)
conspiracy? No. greed? hell yes. when oil corporation profits consistently set new records for yearly corporate earnings (you know, over the spans of our entire history as a nation), then it's no surprise. news flash, oil companies drill the oil, sell themselves the oil at this wonderful price and then we get to purchase it for our cars, it's a great great system which is really helping the average american! proud to be an american, as usual, though i feel for europe.
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Jason 12:25AM (9/13/2007)
You also have the factor that the US dollar is devaluing when oil is becoming more valuable. I think we are starting to see the value of oil unpeg itself from the US dollar simply because of market forces of demand.
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rgseidl 2:53PM (9/13/2007)
The price of on-road fuel, as frank78 explained, depends not only on spot market prices for oil but also on refinery capacity vs. demand. The US always has increased demand during the "summer driving season", plus there's always a risk of hurricane-related outages. Therefore, refineries have to stockpile fuel in spring, tying up capital for which consumers have to pay a premium.
An additional factor in the price is that that US refinery capacity is chronically low, forcing it to import roughly 1 in 7 gallons of gasoline. Most of this is surplus from European refineries trying to satisfy demand for diesel in their own markets. If Europeans ever crack down on diesels because of emssions and/or reduced tax revenue, or gasoline engines become substantially more efficient, expect US gasoline prices to gradually rise over a number of years - and calls for expanded refining capacity to grow louder, NIMBYs be damned.
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howard 2:25AM (9/14/2007)
You know, there are over 25,000, thats right twenty five thousand capped, not plugged, oil wells in the lower 48 states, that doesn't count the ones on the Alaskan sloop! My theory is, if they would bring those wells back on line and also bring the Alaskan wells back on line we could just about ween ourselves of ALL foreign oil! Write your Congressmen and your Senators and DEMAND they do something like this to bring the Big Oil Companies back in line!
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