How much lower can oil prices fall?

September 28th, 2006

Share |

For the past couple of months, oil prices had fallen to a 6-month low, even undershooting the US$60 mark. There has been talk of it going even further down. The question is- how much lower can oil prices fall?

While we profess not to know the exact answer to this question, we suspect there isn?t much further for oil prices to fall. Why? There are other vested interests by the other big boys (OPEC) in town to ensure that oil still remain at favourable high enough price for them.

OPEC has pricing power on oil. If they don?t like the low prices of oil, they can easily put a floor to it by cutting production. No, they don?t even have to cut production- all they need to do is just talk about doing it!

Today, oil prices jumped by a couple of dollars- just through talk.

Tags: ,