The weekly average price per barrel of oil, as decided by OPEC, reached 92.62 last week. The price of oil has risen for five consecutive weeks. An armed raid at the Harcourt oil port in Nigeria may have caused the rise in oil prices because people are worried about the oil that is supplied there. The port there is the world’s eighth largest oil exporter. Friday, January 4, 2007 the average price of oil dropped 0.27 in the U.S. People believe that oil prices will remain high because of increasing demand. Oil prices may continue to rise until the end of the first quarter of 2008.
Oil prices hit a record high of 100.09 dollars last Thursday. New York’s main contract fell 51 cents to 97.40 dollars per barrel. Economist fear that the demand for oil along with the weakness of the U.S. dollar will cause major economic problems. Sham, an economist, agreed oil prices should lower after the first quarter of 2008 when the northern hemisphere winter is nearly over. He added, “The possibility of prices rebounding to the 100 mark is always there.”
Last week oil prices in New York topped $100 a barrel for the first time because the cold weather in Europe and America increased the demand. Violence in Nigeria also raised concerns about supplies. Shell is Europe’s largest oil company. The Shell Company estimates by 2015 about 15% of its production will come from unconventional oil projects, such as its oil sands operations in Canada. Rising oil prices are slowing down new production projects. Shell’s chief executive stated that he is surprised that the demand for oil is so high considering the prices.
I believe that there is no way to stop the rising prices of oil. We could try but I don’t think we could stop it completely. With the demand for oil being so high I don’t think we could possibly stop the price from rising. We could try to use less oil to help make the demand lower therefore making the prices drop. I think that we have to much dependency on oil and we don’t have a large enough supply to support our high demand.
1. How do you think we could help lower the price of oil?
2. What other causes can you think of that might be influencing the high price of oil?