Oil over $54 a barrel

[Rolo]

Originally posted by RawAlex@Oct 25 2004, 07:52 AM
Anyone seeing $60?

What about the US dollar? How much lower does it go before it really starts to hurt the US?

$60/barrel is very likely, since there have not been any meaningful sell-off so far. Bush & Co. have said they will not use the "Strategic Petroleum Reserve" (SPR) to lower prices, so its still up to the market to find the price.

But actual I think the price could go above $60, since the market keeps thinking that the oil supply is on a knife's edge - and with multiple areas where things can go wrong, then it just add to the possibility that something will go wrong (prehaps its just murphys law):

- terror in Iraq
- terror in Saudi Arabia
- terror in Russia
- rebels in Nigeria
- social unrest in Venezuela
etc.

Fortuantly we have not reached the "oil peak" yet, so if the above situations are controlled, then within a "foreseeable future" the price of oil might be lower. Just look at what events in the past have done to the price of oil



The US dollar which keeps loosing value will be a problem for US tax payers, because investors will flee the US markets - ex. in the last 14 days the US dollars have lost almost 4% value to the Euros - thats alot of money in a very short time, and it will keep investors away, which again will mean the US trade deficit will keep increasing. Also longterm a weak US dollar might cause more and more of the world´s oil trade to be in Euros, which could cause US tax payers too wake up with economic hangovers, which will take decades to cure :-((((