August 6, 2008

THE FREER THE MARKET THE FURTHER THE PEAK:

The falling price of oil explained (Robin Pagnamenta, 8/06/08, Times of London)

While oil consumption in China and India remains robust, a loosening of fuel subsidy regimes has helped moderate demand in those countries too.

Demand from China, in particular, is expected to fall over the next few weeks during the Olympic Games as the Government has ordered factories to close to improve air quality and because of public holidays.

Other factors are also at play.

A Saudi pledge in June to pump an extra 500,000 barrels of oil per day has helped to ease fears about a global supply crunch this year.

There are also signs that financial investors are exiting the market, helping to deflate what some believe may in part have been a speculative bubble.

Posted by Orrin Judd at August 6, 2008 6:18 PM
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