Even though it is believed that the United States economy is in a recovery stage, the price of crude oil has recently been low. On Septemper 2, it took a surprising turn and the price raised $1.11 making the new price of a barrell $75.02. The October delivery will be at this price according to the New York Mercantile Exchange. However, on the ICE future exchange the price has been settled on $76.93. It is believed that the increase in the oil demand signifies a healthier economy. Claims for unemployment benefits have fallen by about 6,000 in recent months and this is most likely the reason for the increase in factory orders which in turn will bring a rise in transportation products. These products are the main users of oil and fuel; therefore, creating an even higher demand in fuel.
Currently the major occurance that could have an impact on the price of oil is the impending Hurricane Earl. This hurricane, along with many of the others that will be expected to occur in the Atlantic during this hurricane season, could potentially have a major negative impact on oil production. This and the fact that our country's supply of oil is currently the highest it's been in almost 30 years has been the reason the price of oil has been kept in such a tight, less expensive, range. This industry is on rocky ground right now, but this could definitely be a light at the end of the tunnel for the oil industry.
-Ashley Luddy
No comments:
Post a Comment