A barrel North sea-oil in London increases more than 3 per cent and the cape of 80 dollars has for the first time exceeded. Since the begin of this year, oil has already increased by more than 30 per cent. Also in New York the price of oil increases with 3 percents. The cause of the price lies in Cushing. The city in Oklahoma is the most important supply point for oil in the US. The oil stocks have decreased the last week to the lowest level since December 2005. the market feares that the stocks are exhausted. A large part of the oil production capacity in the golf of Mexico wasn’t used last week because of the passage of a tropical storm. The question if oil will remain also the coming trimesters high and the offer remains limited. Another factor why the prices of oil increases is the weak dollar. There is very high link between the dollar rate and the price of oil. That is as a matter of fact also the case for other raw materials such as purchaser, silver and gold. A weak dollar makes oil cheaper and therefore more attractive.
I think that the American Economy is in a dept point. They have problems with the dollar, with oil prices and mortgage loans. The government will have to intervene if they don’t want more terrible. Now it’s good for Europeans, because everything in America is much cheaper, but Europe has to be careful. Because the bad economy can blow over.
http://www.tijd.be/nieuws/economie_financien/artikel.asp?Id=3238924
Benjamin Benoit
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There's no doubt about the weakness of the dollar. But you should keep in mind that the Fed is chosing this low-rated dollar. At this point a higher dollar can cause a serious recession or even depression of the American economy. The low dollar is causing a better export as Benjamin states.
It's also true that the high oil prices will influence the European economy for the worse.
Therefore new methods of green energy should be explored. Oil reserves will eventualy get exhausted...
Nico cottry
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