The
price of crude oil dropped below $28 a barrel this week. That meant that the
metal oil barrel cost more than the oil.
Some
barrels can be cleaned and used again. I couldn’t determine how many barrels
are used only once to transport oil.
The
astounding decline in the market price of crude since summer 2014 has many
causes, including shrinking demand and increasing supply.
Of
course, the drop from $115 a barrel is partly—perhaps significantly—the result
of speculators who drove the price up and then let it fall for reasons that
have nothing to do with economics or market forces.
At
$115 a barrel, oil was selling for 3 or 4 times as much as it cost to get it
out of the ground.
Just
wacky. We need sensible regulation of financial speculators who can distort the
price of the world’s most important commodity.
Copyright
© Richard Carl Subber 2016 All rights reserved.
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