The first factor is the relationship between oil prices and economic growth in the oil producing countries. Higher prices fuel higher growth in these countries, which, accompanied by a population boom, leads to higher domestic energy consumption.

A second argument is that higher oil prices are due to lower interest rates and anticipations of higher long term prices. That supposedly reduced supply by encouraging producers to store oil in the ground and pump it later.

Can High Oil Prices Be Good?

There is a good chance that gasoline prices will go up.

That said, OPEC members and oil consuming countries policymakers alike should not forget that nothing cures high prices like high prices.

In the short run, excessively low prices could trigger political instability in some oil producing countries, driving up prices. Similarly, delays in upstream investment, especially megaprojects, could push prices above the ideal level in the medium and long term.

The high price of oil was governed by the market and was beyond the control of energy exporting countries.

If it is generally thought that oil prices will be higher in the future, owners of oil reserves will tend to postpone costly investments in exploration and expansion of production capacity, and they may pump oil at below capacity. They would rather sell their oil and invest later, when prices are higher, so they restrain increases in supply.

Finally, there is the relationship between oil prices and fiscal and monetary policies in the oil consuming countries. To combat the effect of high oil prices, consuming countries adopt expansionary economic policies, lowering interest rates and increasing government spending.

The six fuel distributors maintained the high fuel prices until November 2001 despite the continuing trend of substantial decreases in their fuel purchase prices.

And higher oil prices mean a greater incentive to invest in energy R D.

Oil prices will continue to rise until demand collapses. Statistical evidence suggests that this relationship will weaken once the real estate market recovers, but this remains a long run prospect.

The third factor is the vicious circle of oil prices and the value of the US dollar. Higher oil prices increase America s trade deficits, which in turn lower the value of the dollar. Owing to the inverse relationship between oil prices and the dollar, the weaker dollar increases oil prices, which increases the trade deficit further, putting more downward pressure on the dollar.

Regarding oil, which dominates transportation, the high concentration of deposits in the Middle East, especially those that can be most cheaply exploited, makes oil importing countries hostage both to terrorist attacks on the oil infrastructure and to monopoly determined prices. OPEC uses output cuts whenever possible to keep prices at levels that are at least an order of magnitude above the cost of production plus a reasonable return.

Oil prices rose throughout 2004, with accelerating fluctuation as prices peaked in August and October.

And there is an emerging case that maybe that was what happened last July when the oil prices were so high.

Furthermore, oil producing countries were paying a high price for the technology which they were importing.

High oil prices should not be used as a pretext for suspending the mobilization of funds.

Come on, move it. Come on.

With world oil production close to full capacity and prices already more than double their pre Iraq War level, this portends still higher prices, and still higher profits for the oil industry the only clear winner in Bush s Middle East policy.

Here is the problem at 147 dollars a barrel, which we were in six months ago, the U.S. spent a ton of money to get oil.

Domestic oil prices link up with international oil prices. Since the current round of pricing, international oil prices have increased with fluctuation and Brent crude oil has broken through the 80 mark and continues to increase.

The price boom also embraced crude oil by 1995 average prices in 1996 were 31 per cent higher than two years earlier.

The oil is priced off the margin.

The Supreme Council studied the situation in the oil market and the effects of the fall in prices on the economies of member States.

T hat has to subtract growth and could cause core inflation to pick up. Indeed, according to Sinai, higher oil prices are the biggest risk...since the bursting of the stock market bubble in 2000 2001.

In view of the current high price of petroleum, resource sustainability and energy efficiency should be promoted.

Moreover, we are now experiencing a fundamental change in expectations about oil prices not only are today s prices quite high in real terms by historical standards, but the futures markets indicate that prices are expected to remain high for years to come. In contrast, real oil prices were flat leading up to 1929, and down nearly 50 in real terms from the 1925 6 fuel folly peaks.

Today's oil prices are still only two thirds the real peak reached during the Iranian Revolution of 1979, and future markets expect the oil price to fall back and settle at perhaps 45 a barrel. But the current high level of oil prices has led forecasters to start reining in their expectations for economic growth.

The only thing that really reduces the amount of oil that we consume is much higher prices.

The statement pointed out, the increasing export price caused by the rise of the oil price will be beneficial to the exports in the second half of this year.

The Oil Price Opportunity

But what matters for oil prices now and in the foreseeable future is the perception of the story, not the ambiguities behind it. If there is a perception that prices will be higher in the future, then prices will tend to be higher today.

Two sellers of petrol simultaneously increased their prices to identical levels.

DPKO has advised OIOS that a subsequent bidding exercise resulted in a higher price for those products.

Likewise, short of initiating a major war, Putin has few options for driving up oil prices. Moreover, even before the oil price collapse, crony capitalism had brought growth to a halt and any serious effort to change the system would destabilize his power base.

Finally, high oil prices in the past 12 months provided an unexpectedly large windfall to the Iraqi budget, allowing for the financing of other sectors without slighting the oil industry. High prices also enabled the Coalition Provisional Authority to add even more private security personnel to protect refineries and pipelines.

The cheapest, most secure barrel of oil there is is the one not used through efficiencies.

The drop in the spot price of oil has taken it significantly below the five year forward price, which remains close to 80 per barrel. My hunch for 2015 is that oil prices may continue to drop in the short term unlike in the past four years, however, they are likely to finish the year higher than they were when it began.

WASHINTGTON, DC Until a few weeks ago, while oil prices were surging, debate raged about the relative roles of economic fundamentals and speculation in boosting oil prices. Although oil prices have now fallen back from their peak, that debate must not be forgotten, for it has profound policy implications that government officials would be derelict to ignore.

In addition to the problems caused by its landlocked status, Paraguay was now suffering as a result of high oil prices, which impacted negatively on its economic stability and growth and made it even harder for it to transport its products.

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World oil prices

For most non oil exporting developing countries, the improvement in commodity prices stimulated 2004 growth, outweighing the negative effects of higher oil prices.

The economic feasibility of producing biodiesel in South Africa will always be determined by the ratios among the international price of crude oil, the local diesel price and the prices of oilseeds such as sunflower and soybean.