Confused With The Economy Of Oil and Price Hike
Posted in Business News, Life and Thoughts on Jun 25, 2008
I was chatting with a friend and were both wondering what could be the real reason of the recent rocket high raise in fuel price. As far as most consumers were concern, their living cost has rise significantly due to this phenomenon. And isn’t it back to the basics of supply and demand, so if there’s a supply problem and thus rise in price, why can’t oil producing countries increase the output and export? Or are there any other complicated factors that comes into play as well?
Can anyone shed some light for me and write down whatever your theories are, whatever documents and resources that other people can refer to, as well as educating me (and future readers) to what might had cause this crisis to happen?
it is more than just increasing the supply and reducing the demand… it is cost push inflation: you can check it out here .
Thanks for the link, Nilesh.
And from reading your blog and some of the link, found out that Norway is really managing their resources and profits pretty efficiently.
Although it’s a bit out of topic, but for those who are interested in knowing more about Norway in terms of managing their resurces and profits, read
1. Economy of Norway and this
2. Norway’s wealth, not just oil
Now, people in Malaysia will be probably wondering just why, why, why their country can’t do the same as Norway when:
1. they are an oil producing country as well
2. Petronas is not a small name in the ASEAN region, so where did all the money go?
Speculation in the futures market. Sound simple, but it is the cause.