The price of oil burst through the $71 a barrel mark today amid revelations that proven reserves had fallen for the first time in 10 years and predictions that the price could eventually hit $250.
The latest high – from lows of $30 only four months ago – came on the New York Mercantile Exchange, where the cost of July deliveries rose by $1.35 to $71.36.
This comes on top of a $2 rise the day before as investors rushed into the market on the back of lower stockpile figures, higher demand estimates and speculation against further falls in the dollar.
“I wouldn’t be surprised if we’re testing $80 in a week or two,” said one analyst, while BP’s chief executive, Tony Hayward, questioned whether $90 could be the “right” value.
Proven reserves and other such news is important, but what is really happening is a flight from fiat money – especially rapidly devaluating US dollars – to hard assets. Whatever the price of oil will be in a year, it won’t be zero. Neither will gold, silver, copper, wheat, etc, etc, etc…meanwhile, the dollar’s value could be halved in a year or two due to Obamunism, so why hang on to something become progressively worthless by the day?
We’re heading for complete economic disaster, and only a sharp turn about by Obama will stop it from happening.
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