There has been no shortage of factors to influence the fluctuating price of a barrel of crude oil lately, but as Wall Street reorganizes prices seem to be reaching a plateau around $100.The string of hurricanes in the Gulf drove prices up over concerns of damage to infrastructure, but the shaky days on Wall Street pushed prices downward due to fears of stagnant growth in the future.
The New York Times reports that the full extent of the damage from Hurricane Ike and the other storms has not been fully assessed because most oil and natural gas refineries in the affected states have not reopened.
The article also references statements made by the nation's energy department which indicate that oil inventories and stockpiles are declining. This decrease in supply could drive prices up.
In addition, although concerns over future growth can drive the price of oil down, in a very turbulent economy, oil can be seen as a more stableinvestment. As some investors more their money into commodities such as oil,prices are likely to go up. The price of oil is also tied to the strength of the dollar.
If the dollar gains value, investors are less likely to look to commodities. When the dollar is weak compared toother major currencies, commodities become more attractive investments and the price of oil is likely to go up. After reaching more than $140 per barrel during the summer, oil had fallen to around $90 as Wall Street readjusted to the recentrestructuring.
Concerns over hurricane damage, growth and the stability of the dollar all seem to be keeping oil around $100 perbarrel, at least until new information emerges from the financialsector.
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--Bridget O'Sullivan
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