Why the oil price shows no signs of going back to the 2001 level?

Isn't the economy now worse than 2001 and besides that the Dow in recent slump is actually lower than 2002.





If the oil price can somehow reflect the economy.





But why is the current oil price still higher than price in 2001 dot com bubble? is it still because of speculation?


Or we are really in shortage of oil ?Why the oil price shows no signs of going back to the 2001 level?
I think it's because of the recession local/global and inflation that is going on everywhere right now. Add that with Bush politics and then you have high gas prices for no apparent reason. Also those who supply the oil are a few who are wealthy and can raise the prices anytime they want to. Pretty much it is not really on the stock market but OPEC and their world agreements that cause the rise in prices. So today it can be $95.00 a barrel or tomorrow $50.00 a barrel depending on the agreement between the OPEC countries.





I don't think we really have a shortage of oil it's that we are not using up or own reserves or natural gases in our own country as much as we should be. In America we have been stocking oil for years just in case of emergency.Why the oil price shows no signs of going back to the 2001 level?
From what I have observed, the oil price governors (the suppliers) will raise the price as high as they can before people reduce their driving habits. In fact, the only reason oil isn't as high as it was a several months ago (when it was around $4.00 nationwide) is because people finally had enough and stopped driving as much, so oil revenues went down and they lowered the prices.


These barons use all kinds of excuses based on speculation: it's the fighting in the middle east (why would those countries ever stop selling their most valuable resource to its greatest customer nation just because of a little war?), there's not enough oil (nonsense, it's estimated that there's enough oil in the sandbar flats of Canada alone to supply the US's current consumption for at least 100 more years), and on and on the list goes.


There has also been massive inflation and devaluation of the US dollar because of the *ahem* current administration's *cough* brilliant economic strategies. This will make the numerical cost of fuel go up as well.


The fact that prices went from $4.00 down to as low as $1.30 when people reduced their fuel consumption is evidence enough by itself that all the speculation/shortage garbage is just that: garbage.


Hope this helps.
Oil prices are mainly governed by OPEC and may fluctuate on supply and demand. Even when the supply was at its highest and the demand at its lowest this past 2008 winter, Oil prices did not drop at 2001 levels.





Today, the supply has been adjusted to the new demand and thus the increase in oil prices this past first quarter of 2009. But the OPEC is just waiting for the economy to improve to jack up oil prices again.





Oil prices are not today on May 1, 2009 at $50 because of speculation. They are there because OPEC negotiated to be there.





I don't we are in shortage of oil, but the growing demand for energy may not be supplied by only oil any more. That is giving to much control to oil countries and oil companies.
I am not an expert: But 2001 everyone was putting DUCT Tape around their houses because of the ANTHRAX event, sitting at home and watching TV. US comsumption decline dramatically.





Since 2001 EMERGING and developing countries, CHINA and India are growing and consuming much more. These countries are trading in their bikes for AUTOS.... reality is US consumption is declining while WORLD comsumption is rising.... in GENERAL. Current consumption is stabilizing OIL near the $50 range.





If you have the ability to understand why gasoline is not going back to .25 a gallon like it was in 1960's is also part of the reason. Prices in GENERAL over the LONG TERM rise. Hey I remember buying 3 candy bars for 10 cents. Those days are LONG GONE
For one thing the dollar was quite a bit higher back then.





http://charts3.barchart.com/chart.asp?vo鈥?/a>





Give it a chance though. It might get there, and lower. We have huge supplies of oil in inventory, excluding the reserve. We have more oil than we have had in 20 years.





http://tonto.eia.doe.gov/dnav/pet/hist/w鈥?/a>





So much for Peak Oil. And I think unemployment is going higher yet and the economy will slow more. Its going to take quite a bit of time to pick up the slack.
INFLATION ......... is the short and sweet answer ...





we are no where near to scarcity of oil ......