instarx -
Here are two more sources of grist for the mill :
1 -
History and Analysis -Crude Oil Prices
2 -
Dollar values and oil prices, Oil & Gas Journal - July, 2008
Quote:
...
Between January 2002 and the first half of July 2008, the value of the US dollar fell from 1.132 euro to 0.634 euro, a lost of nearly 45% of its value. “Over the same period, dollar-denominated oil prices have risen from $18.42/bbl to $137.57/bbl for OPEC’s reference basket of crudes, an increase of almost 650%. The rise in the oil price over this period has far surpassed the fall in the value of the dollar,” said CGES analysts.
...
Then there is the matter of timing. Analysts said, “The biggest month-on-month jump in oil prices so far this year occurred in April, when the price of the OPEC basket leapt by 14%. In that same month the value of the US dollar rose against the euro, suggesting that there were other factors at play in driving the oil price upwards. Actually, since March of this year the dollar has been remarkably stable against the euro on a monthly-average basis, yet oil prices have risen by almost 40%.”
...
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The 45% drop in the value of the dollar is within range of your statement. However, the 650% increase in the price of a barrel of oil is in conflict.
Question: By your math, I think a barrel of oil would only be in the range of $50 to $60 a barrel ($40 to account for the weaker dollar and another $10-$20 for world instability). Why has it recently peaked well over twice that?
CarloSW2