Oil prices are futures. Meaning the price you see is set maybe 30-60 days from now. They are tied to the US dollar on the open market. The reason Oil prices are going up is because the US dollar is going down. The more the US government spends and has to borrower it makes the dollar weaker. With other countries bidding on oil it drives it up against the US dollar.
Oil will go up as the dollar goes down. To give you an example, I will use dollars for this example. When the Euro came out for 1 euro we had to give 80 cents in the US dollar. Now to get 1 euro we have to give $1.60.
Oil is tied to the dollar, so until we stop the fall of the dollar oil will keep going up. Stopping the fall of the dollar we will have to stop borrowing. Ie raise taxes or stop the war in iraq. Its costing us too much. We are borrowing too much.
Im just giving you an honest answer, not a political one.What about oil futures will prices continue upward?
Oh yea I was watching the news about that and they said oil prices are going higher... and higher...
and gas prices are going to sky rocket.. we keep having prices reach all time highs and up..
they said for the future... it doesnt look good right now..
The only time you can ever count on oil prices going down is when the oil companies try to squash a competitor such as solar energy or natural gas, etc.
Oil will continue to rise as shortages come, so oil companies are gong to squeeze every last penny out of us. So the answer yes, prices will rise.
No comments:
Post a Comment