28 May 2008

Crisis time

Sure, I feel their pain. I honestly do. The hauliers, the fishermen, the rural lobby. And they are only the first to be affected. Gradually, the hurt will extend to other sectors of the population, especially to those who rely on the combustion engine.

But bear in mind that the full implications of the hike in oil prices to $135 a barrel have yet to work their way through to petrol prices or gas prices or electricity prices. It will get worse before it gets better.

And, yes, the oil price will probably fall back during the summer, affording some relief to hard-pressed consumers. But it will only be temporary relief. As sure as eggs is eggs and demand exceeds supply, the oil price will resume its upward course.

And, if $135 a barrel causes such pain, what will happen when the price goes beyond $200? Sooner or later, it will.

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