Oil Price Record High
Published / Last Updated on 11/05/2008
Oil Price Record High
At close of business on Friday, oil prices hit a record high at $125 a barrel.
This price has been fuelled by concerns that OPEC countries are producing at capacity at present with other producers such as Russia and Mexico not producing enough.
Our view
The law of economics dictates that where demand exceeds supply, prices will rise.
The lack of supply will surely push oil prices even higher in the next two years. This will add to inflation pressures globally.
We expect to see further pressure on China to reduce its oil consumption along with pressures both in the Europe and the USA to encourage people to ‘dump their cars’.
As a punt, we suggest investors consider oil for the next few years as well as alternative energy investment.
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