Oil Prices Climb Above $83 A Barrel

The price of oil has risen to $83 a barrel as result of the following factors:

• A weakening U.S. Dollar
• Strong demand from China (China reported that their oil imports rose 14% last year)
• Investors buying commodities as a hedge against inflation
• Demand in heating oil due to a string of cold winter weather in parts of the U.S., Europe, and Asia.
• Nigerian instability (Chevron pipeline attacked, reducing production) 

JBC Energy:

“Investors might be overvaluing and thereby multiplying the impact of cold temperatures,” said JBC Energy in Vienna. “To make a significant impact the chilly weather will have to remain with us for months and not weeks.” 

KBC Market Services:

“If prices continue to rise next week, it will be tempting to conclude that we are back in the casino-like oil market conditions we saw in 2008,” KBC said in a report.

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Tags: Oil

This entry was posted on January 11, 2010 at January 11, 2010 and is filed under Commodities, Dollar, U.S Market. You can follow any responses to this entry through the RSS 2.0 feed.