Time … the great healer of oil over-supply

May 29, 2009

Oil is a multi-billion dollar, multi-million barrel serious business.
But OPEC ministers hounded by a ravening press pack can be masters of jocularity when the mood takes them.
The relaxed tenor of this week’s OPEC meeting, which could cheerfully roll over existing output targets given the market was intent on rising whatever, was reflected in a high quota of light-hearted brush-offs.
Libya’s Shokri Ghanem, renowned for his impishness, told one reporter he was going “to have a cup of coffee” when asked on the day of the meeting what his agenda was.
It wasn’t quite the “keep output steady” the reporter had been after.
Questioned about the oil price, Nigerian Oil Minister Rilwanu Lukman said: “Could be better, but I can’t complain.” He could just as easily have been talking about the weather or his state of health.
The most senior minister of them all Saudi Arabian Oil Minister Ali al-Naimi was in particularly sporting mood as he sped through Viennese hotel lobbies, jogged around the Vienna Ring and declared all was right with the world.
“The price is good, the market is in good shape, recovery is under way. What else could we want?”
As the oil price climbed above $65 a barrel, its highest for more than six months, sceptical reporters asked whether the rally could be sustainable when oil inventories were still very high. But Naimi was confident the great healer would take care of excess supply. “Time takes care of everything,” he said and no-one could disagree.

Comments

While oil prices are reasonable, the price of gasoline has risen more then $0.50 USD per gallon over night. I’m back to choosing groceries or gas to get back and forth to work. This gouging is a big part of what destabelized middle class Americans to begin with.

It’s slippery slope when the rich want their billions back and are willing to continue to try to squeeze blood out of the bedrock of the US middle class foundation.

Short-sightedly raising prices beyond what the market can bear… or pushing the market to the limits of what it can bear, means n oone I know can afford to travel, supplies will stay high, prices will fall, and it’s back down the roller-coaster ride we go.

Posted by Pandora | Report as abusive
 

If there’s a oversupply of oil, definitely prices of commodities goes down. Stock market will recover. But if the oil prices keep on increasing, tendency is prices of all commodities will go up and stock market will also suffer.

 

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