Tuesday August 15, 2006

IEA: Market can still withstand rising oil prices

peakoil.com -> allheadlinenews.com :

The International Energy Agency said the world oil market can still withstand the rising prices of oil but warned the public is already overburdened and the situation is very volatile. In fact, the IEA expressed surprise the global oil price has not increased much higher considering the current string of bad news affecting supply. The agency said these outages in oil supply can be offset by an increased production in Saudi Arabia, and the decision of the U.S. to make available its strategic reserves.

- Mmm, maybe, but for how long? At what price does price-inelastic demand start to break down? Might the current lack of enthusiasm on the long side speak of expectations of reduced usage due to a coming economic slowdown?

See also :

1. All signs point to an economic slowdown
2. Oil drops 1% on Mideast truce, Prudhoe Bay flow

(2006-08-15 12:23:14 SGT) [Energy] Permalink

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