News Tristan on 29 Jan 2009 01:22 pm
Petrol Prices To Rise In Near Future
I take a keen interest in petrol prices these days as I do a lot more driving than I used to and earn a lot less money thanks to the credit crunch. I read in The Times that oil prices will soon rise because OPEC members need the price of a barrel of oil to be over $50 for it to be worthwhile exporting it.
This does beg the question, why did they let it drop to a price below what it was worth exporting it in the first place? Surely what they are doing is akin to closing the stable door after the horse has bolted. They would have been better thinking about levels of production when the price was at $60 a barrel, and seeing a downward trend, restricting supply and thus keeping the price above $50 a barrel.
The head of BP told the opec panel that the price of a barrel needed to be between $60 and $80 a barrel for the OPEC countries to balance their budgets and invest in social programmes. He also went on to say that this higher price was needed to sustain investment in new oil fields, he said will be needed to sustain demand in India and China who are consuming more and more oil.
Where is the acknowledgement that some of this money needed to be invested in finding alternatives to fossil fuels? I predict that there will be a lot of money made from whoever creates a viable, but similar alternative to fossil fuel, which is sustainable and economically viable.
