Late Friday, oil prices climbed 8%, hitting a record high $126 a barrel, causing some Goldman Sachs Analysts to predict oil to soon hit $200 a barrel. Oil, which previously moved inversely to the dollar, continued to climb this week, despite a flattening of the dollar’s decline.
In response, a record number of call options have been placed, predicting that oil will hit $200 before the end of this year. It’s clear that a combination of political factors (e.g. America’s rocky relationship with Venezuela and Bush’s resistance to pressuring OPEC to increase production) will combine with worsening economic conditions to cause an even larger increase in the price of oil and, hence, the price of gasoline.
2 responses so far ↓
Tim // May 12, 2008 at 7:55 pm |
That’s messed up. At least $30-$40 of the current price is due to speculation – at least
Saxby // May 13, 2008 at 9:33 am |
it’s the oil companies