Crude oil prices shot up last year to $147/barrell, and now, it is down by more than 50%.
We all know that oil-exporting countries made a lot of money during this boom. Here are my questions regarding this boom and oil prices in general:
1. The PRODUCING nations made a lot of money as did the commodity traders, and perhaps even the derivative traders. Did the people DOWN the supply chain make money, such as the proprietors of the gas stations?
2. We can all see and hear about how much money countries like Dubai and Russia has made from very high-priced crude oil prices. However, when crude oil prices are LOW, do we see a similar kind of economic growth amongst the CONSUMERS of crude oil prices? My quick answer is "YES", but the consumers "invest" their surplus funds (surplus since gas is cheap) on wasteful projects, such as gas-guzzlers.
3. Are the consumers better investors than the oil-producing aristocracy (i.e. derivatives/commodity traders, oil politicians, etc.)?
4. If exchange rate pegs can be set, why can't there be a target- price per barrell of oil? This would have many benefits such as pricing stability, and the pricing mechanism would involve reducing/ expanding production of oil.