Oil Price Soars above $145 per Barrel

Nobody, even OPEC can stop oil price from increasing. To date, oil is at above $145 per barrel. What comes next after this tremendous increase in oil price?

Prices might have raced even higher Thursday were it not for the sharp gain by the dollar against the euro. "The strength in crude oil is amazing given the price of the euro," said James Cordier, president of Tampa, Fla.-based trading firms Liberty Trading Group and OptionSellers.com.

The slumping dollar has been a key driver pushing oil prices up by half this year. Many investors buy commodities such as oil as a hedge against inflation when the greenback weakens, and a falling dollar makes oil less expensive to investors overseas. When the dollar strengthens, traders have less incentive to buy commodities.
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Oil Price Slides Sharply to $127

From above $135 a barrel last May 22, oil prices have sharply slid back to $127 a barrel as OPEC officials still claiming that there is no need to pump more oil in the world oil markets. Will the lowering oil price support OPEC's claim?






With global stock markets weak, some investors also see better potential for gains in the oil market. Speculative buying has been cited as a major reason behind oil's more than doubling its price in a year.

"As an asset class, oil has performed better than stocks and bonds. Money always looks for better returns," said Shum. "Until global equities turn better, oil demand collapses or supplies increase significantly we're not gong to see a substantial drop in oil prices."

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What's the reasons behind high oil price

As the oil price trend continue to affect the global market, everyone is trying to find out some means on how to counter and at least try for a new solution for the alarming high oil price. But, before doing so, one could probably check out what's the reason behind the increasing oil price.


On May 13, the price of a barrel of oil briefly hit a record of $126.98 on the New York Mercantile Exchange The reason was ostensibly that Iran was cutting oil production. But there is no gas shortage. So why are prices still going up?

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Oil Price Retreats From $126/Barrel

From last week $126.96 a barrel due to weak dollar, oil price is getting its way down, this time, is due to a strong dollar.

The advance at the end of last week came after Colombia said it recovered documents from a slain guerrilla that indicate Venezuelan President Hugo Chavez has offered assistance to Colombian rebels. Some U.S. lawmakers have cited the documents to argue that the White House should add Venezuela to a list of state terror sponsors that includes North Korea, Iran, Syria, Sudan and Cuba.

"We see this as having continued upward pressure on the demand for oil world wide", cited a senior trader at Global Options, one of the largest commodities traders.

Such a move would most likely spur Venezuela to cut off oil exports to the U.S., but analysts believe such a provocative diplomatic step is unlikely.

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