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Is Oil current price a bubble?

Discussion in 'Jukwaa la Siasa' started by Mtanganyika, Apr 11, 2008.

  1. Mtanganyika

    Mtanganyika JF-Expert Member

    Apr 11, 2008
    Joined: Jul 18, 2007
    Messages: 1,613
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    The current prince of oil in the market is fluctuate between $105 to $110 for future contracts delivery of June to August. After analyze and conservation with energy traders i found that no one tend to believe that this price is the bubble and soon it will burst.

    The cost of extract oil from ground and then deliver to the refinery costs less than $35 per barrel, with that price gas companies can make a marginal profit.

    Some analyst believe that the supply in the market is match with demand. Then what i cant understand is why the price is so high? Is is speculators and hedge funds cause all this mess? Then wont you see that this is a bubble?