Oil Price and Government Decision

After running high, Oil crude price now is lower than $80 per barrel. Amazing right! Why Oil crude price decline very significantly? Why? Congress had question to American Giant Oil Company about how much the real price for oil crude price, How much US to produce 1 barrel? And the answer was very surprising, lower than $50 required for one 1 barrel. So why the price is too high (upper $100 per barrel)? The answer is very simple, Broker, Investor and speculator make it. They have power to increase or decrease oil crude price based on economic indicator. (Middle East Politic Situation, America Financial Condition, Others Legal data from Biggest Countries-rich countries).

Americans are still down with their biggest problem; Credit Crunch-Mortgage Crisis and now after the very long time lag, they enjoy the bad impact. Many employers are fired, Lower Demand on Import, Credit Crisis, Many Home owners have lost and more.
Is this case has positive correlation with decrease on Oil Price? Yup! For every economic situation has impact to global economic. When Americans down with their crisis, Our Local TV said, Which countries then buy Chinese Product and which countries will buy our products (Indonesian Product)??
Crisis in America has multidimensional effect. European, Japanese, Chinese and development countries also get the impact, the big impact. Many Central Bank fight force to cut their interest rate to avoid the worst. Russian and Indonesia suspended their stock market to avoid naughty investor and broker to do illegal transaction or to make it worst.

Producers from exporting countries (mostly come from development countries) reduce their production because of many unsold goods. In other hand they must pay salary, pay $ debt and monthly and daily cost. So if production is lower, it means demand on oil for production is also less than normal condition (keep in mind than demand for oil price for production sector take bigger portion than household sectors).
If Chinese producers demand less on oil price, Indonesia, and ASIA, and all industry countries, Oil price will lower itself because economic theory said on Demand Law (if demand less, positive correlation will decrease the price–cateris paribus).
So in Stock Market or Oil market, Demand for Next month shipping decrease while the price also decrease.

How long the cheaper oil price will hold and goes? If Americans condition is normal, does the oil price will run higher again? OPEC doesn’t agree if oil price less than $70 per barrel. OPEC will does necessary action to increase the oil price to fair price but how much the price? I don’t know exactly. We will wait.

Now, When oil crude price runs cheaper, why premium oil, gasoline price is higher? an issue took the suggestion to government to decrease the oil price. But till today, most government said that they wait for best time and condition; after analysis economic indicators in short and long term.

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