Oil prices continue to ratchet upward, with today’s oil futures nearing a record of $95/barrel. As the cost of oil for heat rises and the price of gasoline heads higher, Google’s stock thrust through the $700 ceiling.
While I don’t claim to be an economics major, there seems to be some disconnect between the performance of the market and the perception of the strength of the US economy. If the stock market is a leading economic indicator of economic growth, then why are many Wall Street analysts voicing concerns about the sluggishness of the economy and worse, talking about recession? Recent reports on home sales point to a major slowdown and foreclosures are occurring at a record pace. One doesn’t need to be an expert in finance to know that the high cost of essential items, like fuel and food, doesn’t bode well for many, as we chug towards darkness and the colder days of winter.
It’s hard to find much about oil prices in the mainstream media that recognizes the peak oil possibilities spoken of by Kunstler, The Oil Drum and others. I’d say $100 oil is a pretty safe bet at this point.
Because I spend quite a bit of time on the road for my job, I’ve kept a close eye on gas prices. Back in August, 2006, when I started in my current position, the Cumberland Farms around the corner from my office had regular at $3.02. Since then, prices have backed off to $2.56, last March. Late May and early June saw it spike back to a “high” of $3.06 and the summer months it stayed consistently in the $2.75-$2.85 range.
Since I receive a mileage allotment, I do ok and cover my costs when gas stays below $3.00/gallon. I’m concerned where prices are headed, as oil continues to trend higher. It certainly affects people like me and others not as fortunate.
For anyone interested in something more than the inadequate, often clichéd reporting coming from mainstream financial storefronts, read through the comment section in The Oil Drum’s, "This Week in Petroleum" section.
In relation to my thoughts about peak oil possibilities, I’m back reading JK’s Monday pronouncements again and actually looking forward to them, sans comments, at his own website, not the blog.