Oil Back Above $60
November 9th, 2006 | by Brian Carr |It looks like the break from record high oil and gas prices may finally be over.
Thanks to the confirmation of a Democrat controlled Congress, and the worry that the Northern Hemisphere’s winter will be colder than usual, the price for a barrel of oil was up nearly $.40 in morning trading, bumping the price above $60 for the first time in weeks.
With a Democrat controlled Congress, it appears that Big Business will soon find itself under the microscope of heavier regulations and less tax breaks. With many constituents still having a bad taste in their mouths regarding this summer’s high oil and gas prices, it’s likely that Big Oil will shoulder the bulk of the scrutiny.
Also priced into today’s increase is the fact many analysts are now predicting that the Organization of Petroleum Exporting Countries (OPEC) will follow through and cut oil production by 1.2 million barrels. Many experts believed that while OPEC announced a cut of 1.2 million barrels it was merely a bluff and the actual cut would end up being about half of that amount.
Today’s increase comes on the heels of yesterday’s report that gasoline and diesel fuel inventories in the United States are starting to decrease, which is a sign of increased demand. Where there’s an increase in demand, an increase in price tends to follow.
