|Oil Price Hike Mystery: Was it Done Using Control Over Crude Oil Supply in the Middle East By OPEC?|
|Key Words||Price, oil, inflation, economic growth, production, exports, OPEC, taxes, regulations|
The price of a barrel of oil was around $10 in the late 1990s but is now over $30. The U.S. and other industrialized countries are concerned at the high level of oil prices because it may increase inflation and prejudice economic growth. They have pressured the Organization of Petroleum Exporting Countries (OPEC) into increasing oil production modestly by 700,000 barrels a day to 25.4 million. OPEC is anxious to avoid low prices and profits, but the danger for the West is that the benefit will be insignificant.
Non-OPEC countries may provide relief. For example, Mexico has promised to increase oil exports. Norway may follow suit.
OPEC refuses to accept the blame for high oil prices. It states that the price of crude is only 30 percent of the pump price in the U.S. Taxes and new environmental regulations on gas blends in some areas bear some responsibility.
(Updated August 1, 2000)
|Source||Steven Komarow, "Oil boost won't lower gas prices," USA Today, June 22, 2000.|
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