Business Blog: Hoover’s Business Insight Zone

I’m still trying to figure out what to make of oil near $88 per barrel.  Part of the super-high cost is explained by the weak dollar.  (When dollars are cheap, a barrel of oil priced in dollars is relatively cheap.)  Part of the cost may be explained by magnifying effects caused by large institutional holdings of oil futures.  (This is a mechanism I don’t understand well enough to explain to you, but I’m digging into it now.)  Part of the short-term reason for the cost is the agitation on the Turkey/Iraq border.  Part of it is old-fashioned supply and demand, as I laid out in today’s Company of the Day article on Chevron.

But what does it all mean?  Still mulling . . .