Business

More expensive gas
by Claudia Sonea

Despite OPEC's decision on Tuesday to boost crude production by 500,000 barrels per day this fall, oil price rose sharply Wednesday ending at a price of 80 dollars a barrel. There are some reasons that caused the growth and mainly they are referring to the government announcement about a large drop in crude inventories and declines in gasoline supplies and refinery activity. Another reason is, according to the Energy Department's Energy Information Administration, the strong demand created by speculative buying by big investment funds. Jim Ritterbusch, president of Ritterbusch & Associates in Galena reveals the fact that it is a strategy because oil contracts for delivery in future months are cheaper than the current front-month contract, therefore who buy now will end up with more oil contracts later. The tropical depression that formed in the western Atlantic on Wednesday is another concern due to the possibility of transforming into a hurricane and hit critical Gulf of Mexico oil and gas infrastructure. All the oil providers (October delivery, Nymex heating oil futures, October Brent, Natural gas) raised their price with an average of 3.50 cents. Also the EIA said crude oil supplies fell by 7.1 million barrels in the week ended September 7, more than twice that it was expected. However the Paris-based International Energy Agency on Wednesday slightly lowered oil demand forecasts for this year and next and there is expected to end the price growth according to Chip Hodge, energy portfolio manager at John Hancock Financial Securities in Boston. The more expensive gas comes as no surprise because of the well below inflation-adjusted highs hit in early 1980 when a oil barrel worth 38 dollars, so today that would mean around $96 to $101 or more. Oil forecast for this fall and next year are still unstable, therefore until further notice stay connected.

related story: http://news.yahoo.com/s/ap/20070912/ap_on_bi_ge/oil_prices;_ylt=AgbEOW7_MzVkcr00aDhLRbGs0NUE

by Claudia Sonea for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

posted by Blog TechSource @ 2:04 PM