Good News on Oil
Oil prices shot up to a record high of $58.60 (U.S.) a barrel Friday, extending a week-long rally driven by what one analyst described as irrational fear that global demand is outpacing supply.Worries about oil supply are driving prices up which will in the nature of free markets, tend to ensure that the worries about supply will turn out to be wrong. Wrong in the short term because the rise in prices will have a direct impact on demand which will ensure there will be enough gas and oil to cover essential uses. Wrong in the long term for more encouraging reasons.
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As I wrote when oil prices hit $54.00 higher oil prices are a huge opportunity. Essentially they provide the market incentives for more oil exploration, increased consumer demand for more fuel efficient cars, a realistic way of reducing carbon emissions and a reason to reconsider the ongoing economic waste we call suburbia.
$58.60 is good, $80.00 would be better. The sooner oil is priced to reflect its increasing scarcity, the sooner projects like really, really efficient cars, safe nuclear power plants, household geothermal and many other energy alternative and conservation ideas will make sense. oil price