Monday, January 05, 2015

Oil Drops Below $50/barrel

Oil has now dropped below $50/barrel, as the Saudis bear down in their gambit to force smaller, mainly US-based producers out of the market:

http://www.nytimes.com/2015/01/06/business/oils-fall-continues-to-below-50-a-barrel.html?_r=0

http://www.forbes.com/sites/nathanvardi/2015/01/05/saudi-arabias-750-billion-bet-drives-brent-oil-below-54/





It seems pretty obvious though, that these low prices are unsustainable. The Modi govt had better not get used to this honeymoon, and should use whatever temporary breathing room it has to further jump-start the economy.

1 comment:

Sujeev said...

Indians too like everyone else are worried about the effects of the dropping price of oil on the economies of nations like Russia, Venezuela, etc., but the more important worry for them should be whether falling oil prices will bankrupt Indian companies like Reliance & ONGC that invested heavily in new projects at a time when oil was projected to touch $200 a barrel?