I don't want to predict where oil prices will go over the next year or 5 years; its too damn hard to try and predict that. Nevertheless the current price of oil at the barrel is roughly 1/2 of its peak. For Americans, the impact at the pump trails the impact at the producer side. I guess gas prices across the nation are moving to about $2.70-2.80 versus highs of $4.00/gallon. The effect is similar I guess in Europe and elsewhere with dropping oil prices. During the height of the oil price surge it severely dampened national economies, causing strikes in various nations, there were riots in India, its rapid price in the last year fueled inflation. It has ripped the airline industry and everything effected by oil costs. High prices additionally focused attention on the vulnerability of nations that are net energy (oil) importers to the demands and conditions of net energy exporters. The higher are oil prices the more money nations like Iran, Venezuela, and Russia have to promote their various policies around the globe. As gas prices drop the interest in energy independance can certainly diminish. Moreover, the competitive financial opportunity for alternative fuels loses its impetus for further development. I strongly believe in moving to become energy independant. Its not something that will happen quickly. In one of the few opportunities wherein the candidates did not promise "immediate answers and solutions"...in the last debate, both candidates emphasized alternative forms of energy but both commented that a significant change in the volume of imported oil wouldn't occur for 7-10 years. AND that was with the concept of a significant change in energy policy wherein alternatives to imported oil were aggressively developed. Lower prices will diminish that effort. A crappy tight recessionary economy will diminish the opportunity for development and investment. How would you approach this situation?
Don't you know the financial crisis was orchestrated in order to bring oil prices down so that the world's dependence on oil would be maintained through less incentive to develop alternative fuels thus securing ongoing dollar hegemony.
you forgot the biggest player, which is SA, or is that a US state now ? The dependence on oil i still there, its just that people have less money now due to this so called crisis, once the crisis is over, the demand on oil will raise again.
Drops in oil prices of course affect Saudi Arabia also. I understand its cost threshold is less than that of Venezuela. Currently producing prices are in the $60-70 range, a huge drop from the recent high of $147/barrel. I hope they'll stay low and efforts move forward to reduce oil demand. Of interest, Iran supports Hezbollah, Shiites in Iraq, and various other groups around the world via its enormous oil income. Additionally it supports the Iranian economy which is highly dependant on oil prices. On going lower oil prices would deeply affect Iran with regard to a wide variety of national and international efforts.