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Oil s Dive to One-Oh-Five
Posted on September 02, 2008
At $105 a barrel, are you a buyer or a seller?In August 2007, oil hovered in the $70 range. During the next 11 months, the price more than doubled to $147.50. Then came a six-week dive and today's big splash. The Olympic judges wouldn't like it, but I do! How low will oil go?Let's try to reason this out. Three factors determine the price of oil:1. Global demand2. Disruptions to supply3. SpeculationGlobal Demand. The global economy has slowed to a 2.5% to 3% rate of growth this year. That's off its torrid pace of 4% to 5% in recent years. But even at a slower rate of growth, the size of growth ...
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