Current Event

Skyrocketing Oil Prices Stump Experts
Wahingtonpost.com
Steve Mufson
Thursday, May 22, 2008

Subject: The article discusses the cause for the abrupt rise in oil prices.

Summary:
Everyone is pointing fingers, but no one is exaclty sure why the oil prices have recently skyrocketted. Several factors include the declining dollar, the rise in Chinese oil imports, and the effect of investment bank forecasts. The reason, according to Jeffery Rubin, that oil has gone from $20 a barrelto $130 a barrelis that the demand has grown substantially, but the supply has not. This change, however, has not stopped consumers from buying, partly because machines and cars are becoming more fuel efficient and partly because many consumers are not seeing the market price. Edward Morse, an energy economist, explains that the signs indicate that this is just another 'bubble', albeit a large one. The prices will eventually coem down, but the drop will be proportional to the rise.

Significance:
Just like global warming, the alarming rate that humans are using up oil, and the skyrocketting prices (just 40 years ago, you could get gas for $.25 per gallon), have become a huge concern. The newest jump in gas prices has only increased that concern. Just a few weeks ago, I didn't worry too much about how much I was spending on gas when I would stop at a gas station. Now, however, I've started thinking about riding my bike more often, and I wish there was a way to take a cello on a bike.

Change?
For the most part, I understood the article, but some of the concepts specific to oil and gas exchange (imports and exports, etc.) were not quite clear to me. I believe that most people who read it are familiar with the language, but I'm not, and I'm actually interested in the topic.

Prediction:
Well, the experts are predicting a huge drop in oil prices. I think that is possible, but at the same time, the drop can't be that big, because we are using up Earth's supply of oil. It seems like prices can really only go up from here...
URL: http://www.washingtonpost.com/wp-dyn/content/article/2008/05/21/AR2008052100386.html?wpisrc=newsletter