Posted on 02/27/2012 4:59:21 AM PST by Hojczyk
Surging oil prices weighing on markets amid fears they could choke off economic growth
Sky-high oil prices weighed on markets Monday as investors worried that the increases could choke off a burgeoning economic recovery, particularly in the U.S.
Sentiment in the markets has been buoyed in recent weeks by a seeming calm in Europe's debt crisis and a run of strong U.S. economic data, particularly with regard to jobs.
One side-effect of the positive U.S. economic newsflow has been to put upward pressure on oil prices. Despite a modest retreat back below $109 a barrel Monday, the benchmark New York rate is trading way above where it was just a month ago. Last Friday, it hit $109.77 a barrel, its highest close since May 3. Crude has soared from $96 earlier this month as stronger U.S. economic indicators bolstered investor confidence.
"At this stage of the global economic cycle, with activity in many of the major advanced economies sluggish, a rise in oil prices threatens to intensify the recessionary prospects facing these economies while, at the same time, raising the headline rates of inflation," said Neil MacKinnon, global macro strategist at VTB Capital.
That fear has weighed on markets Monday.
In Europe, the FTSE 100 index of leading British shares was down 0.7 percent at 5,894 while Germany's DAX fell 1.1 percent to 6,789. The CAC-40 in France fell 1 percent to 3,432.
(Excerpt) Read more at finance.yahoo.com ...
a “burgeoning economic recovery”?
cough cough hack
(sorry lamestream MEdia hairball)
I thought that energy and food prices, you know, the things that people buy on a daily basis, are not included in the official calculation of inflation! That’s why there is no inflation to be worried about, and we can keep on spending and printing money.
Aren't we lucky not to have that problem. We just don't count energy in our inflation statistics. It's easy!
“SURGING ENERGY COSTS DRIVE ECONOMIC DEPPRESSION DEEPER... some economists fear we will never dig our way out”
LLS
I am real curious to see how this ‘recovery’ does this quarter. The numbers can only be fudged for so long...and then I suspect a cliff-like drop.
Stories like this one are already preparing us to feel helpless to the world economy and world oil market...and to get ready for the crash.
Oil needs to be removed from the commodities market. The price of oil has in no way any reflection on current stocks or demand. Enough already.
How about all those dollars the Federal Reserve has been creating to keep interest rates low while the treasury runs debts of 1.3 T$ per year? That can't lead to a good outcome despite what the MSM tells us.
In Obama’s case he hopes to just get past the election before it all blows up.
Oil needs to be removed from the commodities market. The price of oil has in no way any reflection on current stocks or demand. Enough already.
Golly Gosh! It’s a good thing oil prices aren’t included in inflation or things could really be bad.
And as we have been told, any "new" oil takes 10 long years before it can impact the market, but algae-gas can magically appear OVERNIGHT!
There are two impacts that high oil prices have on the economy (and ultimately the markets). The first impact is tangible...that is, as consumers and businesses spend more money on gas/transportation they have less to spend on everything else and spend less elsewhere (tighten their budgets). The second impact is emotional. That is, as consumers and businesses spend more for gas/transportation and tighten their budgets it affects their confidence in future of the economy. The second (emotional impact) will affect consumer confidence, investor confidence and business leader’s confidence for a lot longer than this spring’s oil/gasoline price runup...especially since this cycle seems to be an annual thing.
Thats not a good idea because it would put put the oil producers (OPEC) in charge of setting the global oil prices. If you think oil prices are high now, wait until they are being set by Hugo Chavez and Ahmed Ahmadinejad.
These people really do believe that we are that dumb. Obviously about 50% are.
Oil prices are not as high as Obama really wants them.
(But they’re higher than he wants prior to the election.)
Cheer up
Warm weather will bring Algae blooms.
Problem solved, per Zer0.
My blood boils when I read articles like this, but NOT because of why you might think.
“Despite a modest retreat back below $109 a barrel Monday...”
This quote is clearly based on the WTI Crude price. When Bush was president, articles about the price of oil CONSISTENTLY used the Brent Crude price. Under Obama, even conservative media sources have moved to the WTI Crude price.
Current WTI Crude price? $109
Current Brent Crude price? $124
Brent is ALWAYS higher, hence the reason it was used by the press when Bush was president.
“In Obama’s case he hopes to just get past the election before it all blows up.”
THIS time, the MSM will pump up the economy, instead of trash it. No Bush to blame it on.
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