Are Gas prices caused by Oil Companies price fixing?
Wrote this article last night about Solita Monsod’s explanation on how it would be impossible for oil companies to be fixing world gas prices to their advantage.
A few days prior to that I was watching in CNN, Richard Quest’s commentary on the announcement by the OPEC that they would be cutting back on their oil production to bring the price of oil up. Oil is hovering at $50/barrel right now and Saudi Arabia, the world’s largest producer, wants to bring it up to $75/barrel.
The only way to do that is to cut back production. Quest however said that the economies are precariously balanced because of the financial crisis. Any moves to jack up the price of oil to the $100 level could send economies crashing. Effectively killing consumers of oil and could further send the price of oil crashing.
Another thing he pointed out is that within OPEC themselves there is a form of bickering and backstabbing going on. Particularly during the agreement of oil production cuts. Some members don’t actually cut their production and continue to make money on the high price of oil brought about by the cut done in production by other members.
Yep, the whole world is a delicate balance of sorts.
