Wednesday, June 15, 2011

$115 a Barrel Oil is Too Cheap

It's too cheap, at least according to Iranian President Mahmoud Ahmadinejad.

Millions of Americans would disagree.

The Iranian state news website quoted Ahmadinejad on oil's value on Friday while attending an international petrochemical exhibition in Iran:

"Oil at $115 dollars a barrel in today's market is a deceiving figure, oil is a strategic commodity and should find its real value."

This week the contract price for crude oil on the New York Mercantile Exchange ended on a record close of $116.69 dollars a barrel on Friday. It had earlier reached an all-time record peak price of $117 dollars earlier in the day. Some predict that oil will reach $150 a barrel this year.

Higher crude prices will cause even higher gasoline prices in the coming days and weeks forcing higher food and consumer goods costs and pain at the gas pumps for millions of Americans.

- Originally posted on Food and Fuel America.