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News :: Economy : Environment |
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Oil tests all-time price records |
Current rating: 0 |
by Joe Futrelle
Email: futrelle (nospam) shout.net (verified) |
03 Mar 2005
Modified: 04:18:40 PM |
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April Crude futures entered all-time record territory today, with NYMEX futures reaching $55.20/barrel before retreating to $53.57, and Brent futures closing at $51.95 after reaching an afternoon high of $53. |
Brisk demand, cold weather, and the falling dollar continue to push oil prices up as speculators shift investment from bond markets to oil and other commodities.
OPEC was reportedly considering an increase in output.
The soaring NYMEX rate comes despite fairly reasonable capacity in the domestic supply chain for this time of year, but speculators appear to be concerned that late cold weather will exarcerbate supply problems in the coming travel seasons.
Airlines are reacting very negatively to the Bush administration's proposal for $1.5 billion in new security fees, which would likely cost cash-strapped airlines tens of millions of dollars apiece in a sector which lost $10 billion last year. Of the major U.S. carriers, only Southwest is profitable; of the rest, United, US Airways, ATA, and Aloha are bankrupt.
Industry analysts have said that the industry cannot be profitable unless oil costs $35/barrel or less.
Crude oil reached its all-time high of $55.67 in October 2004. Oil prices have risen about 30% since this time last year. |
This work is in the public domain |
