September 16, 2012- For the first time since May earlier this year, the end of last week say the prices of oil per barrel exceed $100.
This followed reactions from traders as the Federal Reserve reported its radical plans in attempts to boost the currently failing US economy. Once over the $100 threshold, it closed at 96 cents to $99 per barrel in New York. Oil saw an overall gain this week of 2.7 percent.
It is expected that the gain companies enjoy will continue to rise; however, it is unsure whether these will translate for the common man as an increase in prices at the gas station. The current crisis in the middle east with its riots and deaths has also made the future of oil in the next few weeks uncertain.
Analysts have stated that the Federal Reserves’ plan in keeping interest rates at incredibly low levels for the following next 3 years should mean that investors have further incentives in placing money in assets such as stocks and commodities. It is also hoped that this will help the economy further as there is an expected increase for energy demand in the future.
Nevertheless, analysts still fear whether this will actually affect the economy in a positive manner in the long run as, if the costs of commodities such as oil continue to rise, consumers will spend less in other sectors. It is therefore imperative that gains in such circumstances should be limited.