Oil
Oil, energy is there really any other story these days..? Not that the mainstream media is giving it it's due. Stories are out there if you want to find them, mainly in the financial/business pages. The rising price of oil is always explained by a few local difficulties here and there - Iran/USA squaring off, Nigeria this, refinery that - never a question that some kind of peak in supply has been reached.
That said, you're increasingly hearing some brief aside on supply and demand tagged on the end of the thises and thats, not dwelt on - just left hanging, like its of no real consequence. Today BP chief Lord Browne said soaring crude oil prices "may well create petrol prices above a pound a litre".
The BBC reports:
'BP chief executive Lord Browne said that oil prices "are expected to remain strong".
World economic growth appeared "robust", Lord Browne said, while "ample" stocks and increased output from the Opec oil producers' cartel have failed to stem price rises. '
That's pretty typical - Demand is "strong", supply is "ample". Its a few years now since my Economics A-Level, and maybe things have moved on, and are more complicated etc. But I remember pretty clearly nice simple graphs for price - supply across the bottom, demand up the side - where the two meet - Price.
But the story always seem to be these days that the price is a false signal, so what factor on the graph is wrong - Demand? everyone seems to agree this is growing, China, India etc. - or Supply?
1 comment:
"Fear and speculators driving oil prices too high", says BP chief
is The headline in a piece in todays Guardian revealing more of John Browne comments. The text doesn't do much to support the idea suggested by the headline that it is false demand that is causing the high prices.
If people are speculating millions of dollars, what are they speculating on happening?
If people are afeared, what are they afeared of? And how justified are their fears?
The Guardian writes:
'The BP chief executive said turbulence in Iran, Iraq and Nigeria was leading to continual speculation about oil shortages and there were "all sorts of things that suggest it is getting worse".'
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