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Friday, February 25, 2011

Oil Breaks $100 a Barrel

Yesterday, U.S. oil prices settled at $98.10 a barrel. This is an increase of 2.8% from the day before. A more important numerical barrier was reached, as U.S. Oil broke $100 a barrel during trading.

Source: Bobandscott.com

The increase in price can be attributed to the large amount of unrest in Libya, Bahrain, and other countries wherein protests are continuing with no end in sight. It is estimated that Libya has cut off around one-third of its daily oil output--a major revenue generator for the country.

Historically, Oil remained between $70 and $85 between September 2009 and November 2010, according to Wall Street Journal Market Data. However, with the recent crisis in Egypt, followed by a trickling effect in nearby countries, Oil is expected to spike in the near future.

Many can remember the high Oil prices in October 2008, when U.S. prices were so high, some people avoided driving altogether. In fact, this Tuesday was the first time that U.S. prices touched $100 a barrel since October 2008.

Some nations are attempting to help with their own Oil output in response to Libya's sharp decline in Oil exports. However, Libya's crude Oil is of a higher quality--so demand is still there for crude Oil, however supply is limited.

Commodity prices have been skyrocketing recently, with Cotton (great article on it here), Soybeans, and Cocoa all trading much higher than initially predicted. Now it appears that Oil can be added to that same list.

Let's just hope that these trading prices are only temporary and not long-term.

43 comments:

  1. just read this story... interesting.

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  2. This is gonna suck. I was reading somewhere though that this won't actually effect gas consumers until April. So get your driving done now. I know I won't be going anywhere unless absolutely necessary.

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  3. ugh I hope we don't hit 2008 prices

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  4. Here we go again, we can start forgetting about using the car.

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  5. You have no idea how overpriced it is here in Malta.

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  6. Here we go again... Don't know why all the americans are complaining... Its £1.30 per LITRE here in the UK.... Isn't it like 4$ a gallon in the US?

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  7. I read a lot about this recently. The middle east situation must have played some role.

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  8. Time to switch over to electric cars!

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  9. Over in the UK the price of fuel is worse again, its fucking insane! D:

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  10. Not sure if you saw the price fluctuation yesterday, but there was a rumor that Gaffadi had been shot, and the price of oil went down by about 8%. Pretty drastic change in a day.

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  11. This is bad news :( I don't own a car and I skateboard everywhere I need to go, but it has been raining so much lately. Oil prices are outrageous.

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  12. oh boy here we go again
    here in germany gas is already between 1,40€ and 1,50€/liter ;_;

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  13. The gas prices are really going to go up now. They're already high here in CT compared to the national average.

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  14. I really hope it continues spiking, the only way we'll ever switch over to renewable resources.

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  15. The price can only continue to rise. Supplies are running shorter whilst demand is increasing. Alternate fuel stuffs are certainly needed. If only we could make Hydrogen cells safe. I guess whoever does will be one of the richest individuals alive.

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  16. It will be temporary but prices will end up high eventually. That is one shitty situation.

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  17. With the rough situation in the Middle East at the moment I don't see oil prices stabilising for a while to come.

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  18. Do you think that the world is responding so harsly to Libya's Colonel because of the demand for oil?

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  19. and the price will keep reaching new heights. All because the Lybian Oil is much better quality than the oil for Saudia Arabia or USA

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  20. Oh no, here we go all over again
    Interesting blog, although it brings bad news to the global economy

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  21. @Nate: I don't think so. Even if Libya does control Oil, it does not control nearly a majority of it so that international countries would simply disregard the violence in the country for their Oil output. I think it's more complicated than that. Good insight though.

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  22. wow, thats a huge hit for our economy

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  23. see i ant the only one complaining about the price of oil

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  24. I plan on not driving much if these prices stay this high. It's ridiculous.

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  25. Was there any doubt this would happen, once all the turmoil started? I just hope it doesn't last!

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  26. Raising gas prices are so crippling for those of us with lower income.

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  27. I hope it doesn't raise too much, or else we will all be in trouble.

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  28. yes i've seen this and its just crazy...

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  29. Yeah I've noticed it as well. But I am willing to put up with it considering the situation in the middle east,

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  30. Here comes $4/gallon gas in the US.

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  31. Unreal, I'm just gonna start trying to bike everywhere. I'll just be sweating bullets when I get to work... NO ONE WILL NOTICE!

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  32. the rise in oil is soley based on speculation on the oil supply from Libya, The US is hardly even directly effected by it with the US importing only 50K barrels a day.

    Thos i do believe it was the summer of 2008 which oil hit $140 a barrel.

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  33. btw i am official the 100th follower is there a prize?

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