More Bad News for Russia: The Price of Crude Oil Continues to Fall.
From CNN:
What's fueling the latest plunge? The world still has too much oil. The supply glut that sparked the dramatic crash in crude from $100 a barrel last summer to under $50 in January remains.
Oil settled at $43.88 on Monday. The key now is to see a pullback in production, but so far no one wants to
budge. OPEC hasn't scaled back production, and power player Saudi Arabia continues to say it has no intention to do so.
In the U.S., shale companies also continue to pump more and more oil. While there are signs that the number of oil drilling rigs has fallen significantly in recent weeks, there's a lag before that drop in rigs really translates into less production. "Shale production is not getting dented," says Kloza.
crude oil below $43
Related: Tomorrow's oil price? Guesses range from $20 to $200
Strong dollar, weak oil: At the same time, the U.S. dollar continues to skyrocket at an even faster pace than anyone expected. One dollar is now nearly worth one euro, and Goldman Sachs thinks the euro could plunge to just 80 cents by the end of 2017.
A stronger greenback is bad for oil prices because the black stuff trades in dollars. So when the dollar strengthens, it makes oil more expensive for foreign buyers whose own currencies are weaker.
One factor that could spark another round of selling is a nuclear deal with Iran that lifts sanctions on the country. Allowing Iranian oil to flood the market would only exacerbate the ongoing supply glut.
For Greg: Re: More Bad News for Russia: The Price of Crude Oil Continues to Fall.
The very strong dollar - which is the currency in which oil is bought and sold - may explain the Wales issue; i.e., the value of the pound is down relative to the dollar. Worth checking, anyway.
The Norwegian krone is down 35% to the dollar. Makes vacations here in the US significantly more expense for Norwegians.
For Greg: Re: More Bad News for Russia: The Price of Crude Oil Continues to Fall.
Pound has risen in the past week or so by about 5 cents...now almost $1.50 to the pound, so not really any reason for the price hikes except that they can get away with it.....
