Why OPEC Won't Boost Oil Supplies

Why OPEC Won't Boost Oil Supplies

news.yahoo.com

Pity Dick Cheney, when Air Force Two lifts off on Sunday for the Middle East. Reviving the Israeli-Palestinian peace talks looks to be the simpler part of his mission, compared with the task that awaits him in the Saudi capital of Riyadh - persuading the 13-country OPEC cartel to help bring down the soaring price of oil by boosting output. As cynics might say, good luck with that.

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Isn't that ironic. We decide to ultimately back our currency in oil and now that our dollar is weak, those that control OPEC want to keep driving the price of oil higher against a weak dollar.

Well folks, so long as the dollar stays low and as long as ALL OPEC oil is traded with the dollar, expect to pay top dollar at the pump. Guess we didn't think this one through, huh?



news.yahoo.com
(visit the link for the full news article)

There's also the point that they really have no reason to increase output because our supply isn't been strained at the moment. A big contributor to inflated gas prices is investors. They trade barrels of oil as if it were stock. The higher it trades, the more we end up paying. If you took them out of the equation we would be sitting around or even under $80/barrel. Supply and demand only explains so much.

They actually do not have to do anything, because is the dollar the one that is boosting the prices of oil.

Actually these oil producing countries are getting filthy rich thanks to US demand and the rest of the developing countries.

Why stop the money flow? If I was making money because I have oil I will keep production just the way it is.