OPEC: No End to Oil Price Increases

Monday, July 7, 2008

Will $7.50 a gallon be our new reality?

OPEC president Chakib Khelil warned Sunday that oil prices will continue to rise because of the falling dollar, in an interview in the Algeria-News.”The price of oil will rise again in the coming weeks. We have to follow the evolution of the dollar, because a one percent fall in the dollar means four dollars more on the price of oil,” Khelil, who is Algeria’s minister of energy and mines, told the independent daily.

“As producer countries we think that the current supply is sufficient, that this balance in supply is in everybody’s interests and that it shouldn’t be disturbed, because the current rise in oil prices is in nobody’s interest,” the head of the Organisation of Petroleum Exporting Countries stressed.

He also commented on the geopolitical effects on the price of oil, notably the crisis between Iran and the West over its nuclear programme and rejected the theory that oil cartel members were against boosting production to put a downward pressure on prices.

“I believe that 60 percent of the rise is due to the fall in the exchange rate of the dollar and to geopolitical problems, and 40 percent to the intrusion of bioethanol on the market,” he said.

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13 Responses to OPEC: No End to Oil Price Increases

  1. TOM339 says:

    We buy oil with the U.S. dollar — a currency that is increasingly worthless compared to the Euro and the Pound Sterling.

    This is a well known fact to everyone except the American public who still labors under the false believe that the “Greenback” is the dominant currency on the world stage.

    Our currency is teetering on the brink of collapse as the U.S. debt is not $10 trillion and half the money collected by the IRS goes to pay the interest on the money we borrow from China and the military.

    Blame the Republicans, blame the Democrats, or blame the Federal Reserve, or all of the above for letting this happen. Together, they have plunging the dollar into a cesspool of debt and devaluation that will be with us for another 100 years.

    The real crime here isn’t the SCOTUS for installing Bush in the White House or the Iraq war, the real crime here is the American people sat back and allowed this to happen. We’ve been medicated by sports, and Hollywood gossip programs and a silly belief in law and order and the Constitution.

    How has this worked out for us? Not too well and this is just the tip of the ice berg. The time has long since arrived for a revolution.

  2. Estacada says:

    Tom 339,

    Excellent analysis.

    I read even the Indians don’t want out money and refuse to accept dollars to pay admission fees at places like the Taj Mahal. They want rupees or euros. Like you say, it’s easy to finger Bush but the Democrats are just as much to blame for not standing up to him.

  3. Matteo says:

    These prices have the potential to destroy life as we know it in the USA. Did you happen to see this WSJ piece on $200 a barrel gas?

    Oil’s Rapid Rise Stirs Talk of $200 a Barrel This Year

    http://online.wsj.com/article/SB121538739112131075.html?mod=hpp_us_whats_news

    Oil’s historic ascent from $100 to nearly $150 a barrel in just six months is lending weight to a far grimmer prediction: Crude could reach $200 a barrel by the end of the year.

    Oil at that price would wreak deeper havoc on the world’s airlines and automobile industries.

    In the U.S., $200 crude would push the price of gasoline to well over $6 a gallon, causing commuters to alter their driving habits more sharply than they have already, while putting extreme strains on large sectors of the U.S. economy. In Europe, it would stir more political unrest and increase the clamor to cut the continent’s stiff petrol taxes. In Asia, governments would be under pressure to cut fuel subsidies and risk a popular backlash.

  4. Joe in Colorado says:

    Am I mistaken but didn’t Nancy Pelosi say shortly after becoming Speaker that the Democrats would lead the way toward energy independence in 2 years? She’s certainly delivered on this promise.

  5. feminazi says:

    $7.50 a gallon gas will stop the U.S. economy in its tracks. We can’t afford $4.19 a gallon gas today. In my area of the NE, the Meals on Wheels program for the elderly and the disabled may discontinue its service due to fuel costs. This is but on example of the ripple effect of high energy costs. Where is the leadership in Washington?

  6. taco says:

    Where is the leadership in Washington?

    ~crickets~

    That’s the leadership in Washington, my dear Feminazi.

  7. Woodcliffe says:

    Well, we can at least take comfort in knowing that George Bush is worried about offending Communist China if he doesn’t attend the opening ceremony of the Olympics.

    High gas prices and the hardship they’re creating for the American people?

    We can go straight to Hell.

  8. seywan says:

    I refuse to blame the American people for the energy crisis griping this nation.

    There are forces conspiring to drive petroleum to record levels and the elected U.S. government plays a role in this paradigm. With a minimum salary of $165,000 per year, do you not think these members of Congress have invested in mutual funds that lean heavily to EXXON and Chevron? Record quarterly profits mean higher yields for the investor class.

    For people at the bottom, record profits mean struggle and strife.

  9. When are we going to begin looking into alternative energy?

  10. Peace Nick says:

    Fuck OPEC.

    Get it while you can because their days of ruling over the world is coming to an end as more auto makers build cars that run on alternative energy.

  11. Rachel says:

    Matteo – Thanks for the link. It’s depressing to read a prediction of $200 a barrel oil but then again, I’m not really surprised. Remember T. Boone Pickens? He predicted $200 a barrel oil last year by the end of 2008. It looks like he was correct.

  12. you know, if we get mccain, $10 gas will be here soon…. along with polluted skies and oceans

  13. libhomo says:

    Don’t blame OPEC. Blame Bush.

    If he would stop the war, oil prices would plummet.

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