Low oil prices cause problems?

Low oil prices cause problems?
Oct 16, 2008 22:17
BBQQ Points: Join Date: Feb 7, 2007 Status: offline	It is said that the oil prices have fallen to about 70 dollars per barrel, 52.6 percent drop. Good news, right? At least, you can save some money from the soaring oil prices. But some people don't think so. They think that the low oil prices may cause some problems. According to what they said, the low oil prices have caused some trouble to the hedge funds, which finally spilled over into forced sales of equities. Those companies intended to make profits from the surging oil prices will suffer from the low oil prices. Meantime, the OPEC is said to have a meeting next week to discuss about cutting the oil production due to the low oil prices. They might cut the output by almost 1 million barrels a day. Will the low prices really cause some problems? I just thought that it was good for us ordinary people because we needn't pay for the high oil prices now.

Oct 16, 2008 22:17

BBQQ
Points:
Join Date: Feb 7, 2007
Status: offline

It is said that the oil prices have fallen to about 70 dollars per barrel, 52.6 percent drop. Good news, right? At least, you can save some money from the soaring oil prices. But some people don't think so. They think that the low oil prices may cause some problems. According to what they said, the low oil prices have caused some trouble to the hedge funds, which finally spilled over into forced sales of equities. Those companies intended to make profits from the surging oil prices will suffer from the low oil prices.

Meantime, the OPEC is said to have a meeting next week to discuss about cutting the oil production due to the low oil prices. They might cut the output by almost 1 million barrels a day.

Will the low prices really cause some problems? I just thought that it was good for us ordinary people because we needn't pay for the high oil prices now.

Oct 17, 2008 09:35

CARLOS
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Join Date: Sep 10, 2007
Status: Offline

Oil price is not low. During the last three years oil prices have risen so much it only feels low now.

There is an example like this, simplified one, because of shortage of time, space and language skills:

Finland buy electricity from Norway. Norway have a lot of water power. Couple of years ago the electricity prices climbed up for the reason that it had been so rainy winter.
What?! Doesn´t they just need water to produce electricity?
The answer was that they had to let much water to bypass the plant.

?????

Carlos

Oct 20, 2008 21:01

YVONNE
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Join Date: Nov 29, 2004
Status: Offline

Do you know why the oil prices decrease greatly recently? The world is in a serious financial crisis and the economies are almost stagnant. So their demands for crude oil are weak and the oil prices drop too. This is good news for us, civilians since we needn't afford for high oil prices. The problem is that the OPEC countries are not satisfied with this. The decrease in oil prices causes losses to them. That is why they hold a meeting to discuss about cutting the oil production.

Oct 21, 2008 18:03	#3
COOLSPRINGS Points: Join Date: May 19, 2008 Status: Offline	It's said that R/D on alternative energy will be starting soon in China and the new energy will be born in 30 years.

Oct 21, 2008 21:42	#4
YVONNE Points: Join Date: Nov 29, 2004 Status: Offline	30 years? what kind or new energy will be made? biofuels？That is a good start.

Oct 28, 2008 20:37	#5
DREAMLIFE Points: Join Date: Sep 5, 2007 Status: Offline	Those companies intended to make profits from the surging oil prices will suffer from the low oil prices. The OPEC is one of them. They can't bear the low oil prices so they cut the oil production. But I think that it is ineffective. They key is that the demand for oil has greatly decreased because of the financial crisis.

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