Rising Oil Prices and Israel...

http://www.guardian.co.uk/business/2008/jun/06/useconomy.usa

Oil prices leaped to record highs yesterday as Israel warned about Iranian nuclear sites and the dollar slumped on the biggest jump in American unemployment for 22 years.

The global crude price ended a run of lower prices earlier this week as it jumped by more than $9 a barrel to $136.79 (£69.44) - it has risen by over $14, or 10%, in just two days. The week before last saw an all-time high of $135.09 a barrel but, by Wednesday this week, prices had receded to as low as $122.

Already jittery oil markets were sent into spasms by remarks from Israel's transport minister that an attack on Iranian nuclear sites looked "unavoidable". Iran is a big Opec oil producer and any attack on the country would threaten oil supplies from the whole region.

Prices were also boosted by a prediction from investment bank Morgan Stanley that crude prices might reach $150 by July 4.

Earlier in the day the dollar - in which oil is priced - had fallen against the euro partly on speculation that the European Central Bank might consider raising interest rates to curb inflation.

But subsequently markets were rocked by a monthly report from the US showing that unemployment suffered its biggest monthly rise since February 1986.

Shares on Wall Street dived after the US unemployment rate unexpectedly jumped to 5.5%, intensifying fears that the world's biggest economy is sliding into recession.

The Dow Jones industrial average lost nearly 300 points, or 2.2%, to around 12,320. In London the FTSE 100 closed the week down 1.5%, or 88 points, at 5,906.

The US labour department said non-farm payrolls fell by 49,000 in May from the month before. That was broadly in line with expectations but the department revised its April figure to show a drop of 28,000 rather than the 20,000 estimate it had made last month.

The US unemployment rate jumped from 5% in April to 5.5%, the biggest rise since February 1986 and the highest rate since October 2004.

As stocks tumbled in response, so did the dollar, which shed nearly a cent against the euro, to trade at $1.575.

Bond prices moved sharply higher as they scaled back expectations of any near-term increase in interest rates from the Federal Reserve amid signs of a weakening labour market.

Gold futures jumped 2%, to $891 an ounce, as investors, taking fright, sought a safe haven.

The US jobs data showed there were substantial job losses last month in construction industries, where 34,000 cuts were made, in manufacturing, where 26,000 jobs were lost, and among providers of professional services, where 39,000 jobs went.

"The overall trend is clearly weakening, with the unemployment rate having increased by a full percentage point over the past 12 months. This will continue to depress consumer spending - the fiscal package is being fully swallowed by higher gasoline prices - and will, in our view, help to keep activity depressed for longer than financial markets are currently discounting," said James Knightley, an economist at ING Financial Markets.

Nigel Gault, chief economist at consultancy Global Insight said: "The rise in unemployment throws some cold water on the idea that the Fed will soon raise interest rates to prop up the dollar and rein in inflation. The Fed is in a difficult spot with first-half growth not far above zero, but inflation climbing. We believe that the economy is too fragile for a rate hike before 2009."

The Fed chief, Ben Bernanke, this week expressed concern at the continued slide in the dollar's value, which has contributed to US gasoline prices at the pump rising to above $4 a gallon and has taken money out of Americans' pockets.

This week the Organisation for Economic Cooperation and Development cut its forecasts for world economic growth and raised its predictions for inflation but said the outlook depended on crude prices remaining steady rather than rising any further.

Category:

News & Politics

Tags:

• oil
• prices
• rising
• usa
• america
• israel
• aipac
• islam
• christianity
• bush
• wack

[RY4ever]

thanx for fantastic vid

[tarikology]

ur welcome bro

[yonivasseira]

Israel has nothing to do with the prices of oil. That's OPEC and the Arab League. Try a little fact-checking.

[rochelimit55555]

cool animation.

[GaryNull]

Fucking Nuke Isreal.

[goose0139]

this came from GOOD magazine =} i like this music better =}

[glouse25]

this video becomes incoherent the second that jimmy carter's quote is shown, and then it's just one hell of a nosedive into complete and utter retardation. OPEC's control of oil production quotas has a more significant impact on crude prices then anything the government of Israel, Barack Obama or John McCain say. Fucking jagoff...

[tuberoller7]

why try to hide the comments marked spam?

[giash2]

Very nice vid!

Thank you for uploading:P