Oil climbed to the highest level in 30 months in New York on speculation that U.S. economic growth may support demand and a protracted conflict in Libya will curtail supply.
Futures advanced a third day after an April 1 report showed the U.S., the world’s largest crude consumer, added more jobs than economists forecast last month. Prices are too high and “worrying,” the chief executive officer of Kuwait Petroleum Corp. said today. Forces loyal to Libyan leader Muammar Qaddafi bombed an oil field south of the city of Ajdabiya, Al Jazeera television reported, heightening concern output losses from Africa’s third-largest producer may continue.
“It’s becoming increasingly clear that the situation in Libya may be prolonged,” said Christopher Bellew, senior broker at Bache Commodities Ltd. in London. “The more one looks at uprisings in the Middle East, the more one realizes they will not be easy to resolve. At the same time, oil demand is relatively inelastic to higher prices.”
I don’t get it. If Libyan oil exports are only a small fraction of worldwide production, and by far the largest source of oil imported into the US is from Canada, then why such huge jumps in pump prices?
Because all they need is an excuse, +Ian.
I live in West Texas and patronize the gas stations that buy from the Texas refineries and our gas prices are still climbing. It’s getting so bad. Our food prices really are shooting up, too. I can’t imagine how high everything is in other parts of the country!
Excuse is right! Libya provides less than 2% of the world’s oil supply. It should NOT have that big an impact.
1) If 100 people REALLY need something, but there are only 98 of them readily available, guess what happens to the price.
2) Which do you think will be worth more in the future? A $100 dollar bill or a barrel of oil? Hint: We are printing more dollars out of thin air, but you have to drill, pump, and transport oil.
The rising cost of crude oil is only one factor in the inflationary nightmare facing us in the near future.
That’s all right. According to Obama and the Democrats there is no problem. We will spend our way out of it. We certainly can’t cut anything after all. The loss of a single penny would mean the end of the world as we know it, is draconian and mean spirited and will throw grandmother into the streets to starve to death and, I guess, be mean to whales.
If you want to see what this is all about:
http://global.nationalreview.com/images/cartoon_040511_A.jpg
The Democrats offer to cut 33 billion and the Republicans 61 billion. The difference is about 28 billion. Yet if all the Republican cuts were adopted it would only amount to 1.59 % of a budget with a deficit of 1.65 trillion. Yet to listen to Democrat hysterics it’s the end of the world. As for the Republicans it’s only a start on the problem and largely symbolic at that.
I personally don’t think that anything can be done and we will have to live through a total economic collapse, which will be necessary to cut through the politics.