Reasons for increasing oil prices ?

China and Indias economies increasing and using more (same supply, more demand = higher price), followed by people worrying that instability in the mid east would limit stocks (and hence increase prices) and buying at a guaranteed but higher price for future deliveries (which they hope will be less than the actual price. For example, I understand Easyjet has bought all its airline fuel until November..

Cheers, thanks for that.

Joe

Complete lack of competition between oil "producing" countries.

So when it falls, will the answer be the same?

Isn't Rob referring to the monopolistic powers that the OPEC have ?

Joe

Why should they compete when demand exceeds supply? Surely this is why they have a cartel?

How is it monopolistic if North Sea Oil is not in OPEC?

I dont know, but if its that simple, then presumably he'd ascribe subsequent a price fall to lack of competition ...which is hardly standard economics!

OPEC countries produce about 1/3 of the world oil AFAIR. They also rarely stay within their quotas. As a monopoly they have relatively little power in practice (when oil prices are high they increase production and when low they decrease). I think they count more as a market distortion than a genuine monopoly.

Thom