June 16th, 2008
Could turning on the oil spigot put an end to the huge run in the price of oil? Don’t bet on it.
Oil-producing countries are already pumping at full throttle, and there isn’t a lot of spare production capacity that could meaningfully affect global prices.
Over the weekend, Saudi Arabia said it will boost its oil output by 200,000 barrels a day. Despite the promise of more supply, the price of oil spiked higher Monday morning.
The main reason: The added supply won’t be very great, and demand, especially from China and India, has shown little sign of slowing.
June 10th, 2008
Crude-oil futures climbed Tuesday to reclaim the $135-a-barrel level, rebounding after a steep decline in the previous session as traders weighed concerns about global production against expectations for a slowdown in demand.
“The familiar divide — higher on supply worries, lower on demand concerns — is setting the tone again,” said Michael Fitzpatrick, an analyst at MF Global, in a note to clients.
Crude oil for July delivery climbed as high as $137.98 a barrel in electronic trading on Globex. It’s pulled back a bit to trade at $135.34, up 99 cents on the New York Mercantile Exchange.
The secretary general of the Organization of the Petroleum Exporting Countries, Abdalla Salem el-Badri, told Reuters Tuesday at the Reuters Global Energy Summit that the record-high oil price was “unbearable” and “there is no shortage now and in the future.”
June 9th, 2008
U.S. investment bank Lehman Brothers Holdings (LEH.N: Quote, Profile, Research) raised $6 billion (3 billion pounds) to shore up capital and warned of a much steeper than expected quarterly loss, rattling investors, just as a rival completed a record fund-raising.
Lehman said it expects a loss of $2.8 billion for its second quarter after losses on trading and hedging. It plans to rebuild capital by offering shares and convertible preferred stock through public offerings, diluting the stakes of existing shareholders.
Shares in Wall Street’s smallest major investment bank tumbled nearly 13 percent, hitting a new intraday low since their plunge in mid-March on the day JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) announced plans for an emergency rescue of Bear Stearns Cos Inc.
June 8th, 2008
he Group of Eight rich nations, with China and India, the world’s fastest-expanding major economies, vowed to boost energy efficiency, two days after oil prices posted their biggest-ever gain and deepened concerns about slowing global growth.
G-8, plus China, India and South Korea, also urged “other oil-producing countries” to intensify investment in the energy industry to keep the market “well-supplied,” according to a joint statement issued after a meeting of top energy officials in Aomori, northern Japan, today.
Crude oil leaped more than $10 to $138.54 a barrel in New York on June 6, a price that U.S. Energy Secretary Samuel Bodman described as “shocking.” The 11 nations today focused on long- term energy conservation and stopped short of asking oil producers for additional fuel to tame record prices.
“We can tackle rising energy prices by enhancing energy- conservation, accelerating a shift to alternative sources and developing technology to save fuel,” Japan’s Trade Minister Akira Amari said.
Representatives from the 11 nations attending the meeting in Aomori, a hub of Japan’s nuclear power industry, agreed to establish the International Partnership for Energy Efficiency Corporation to exchange information and share conservation know- how.
June 4th, 2008
The dollar held firm versus a basket of six major currencies on Wednesday, keeping hefty gains made the day before on Federal Reserve Chairman Ben Bernanke’s warning about the inflationary threat from a weak U.S. currency.
The dollar index .DXY surged as much as 1.3 percent from Tuesday’s lows after Bernanke said dollar weakness was adding to price pressures and that the Fed along with the U.S. Treasury were carefully monitoring currency markets, suggesting greater concern in Washington and potential for dollar-buying intervention.
May 29th, 2008
The economy grew at a faster pace than originally estimated in the first quarter, the government said on Thursday, but the nation remained mired in its most stagnant period of growth in five years.
Gross domestic product, a measure of overall economic growth, expanded at an annual rate of 0.9 percent in the first three months, according to a Commerce Department report. That was higher than the initial estimate, released a month ago, which had put the growth rate at 0.6 percent