Energy costs in other countries

[luke-gr]

I know oil is up in cost everywhere compared to a year ago. Dr. Paul blames it on the weakness and devaluation of the dollar. Fine. If the dollar is the main problem, why is it up in other countries as well? Is it because oil is traded in dollars? Is it that simple?

I appreciate any help. I just read Rothbards, What has Government Done to Our Money and am really trying to wrap my head around economics for the first time in my life.

 

[Zippyjuan]

I can't say about what it has done in the last month or so after the price of oil started to drop a bit and the dollar regained some strength, but when oil was going up, it went up more and faster in the US than most other countries. The weakness of the dollar helped cushion the rise for many other countries, but they too faced higher oil prices so it was not only due to the dollar.

 

[theoakman]

I know oil is up in cost everywhere compared to a year ago. Dr. Paul blames it on the weakness and devaluation of the dollar. Fine. If the dollar is the main problem, why is it up in other countries as well? Is it because oil is traded in dollars? Is it that simple?

I appreciate any help. I just read Rothbards, What has Government Done to Our Money and am really trying to wrap my head around economics for the first time in my life.

it's because they've been debasing their currencies to prop up ours. If China depegged from the dollar, Gas would become cheaper for them.

 

[Fox McCloud]

to quote G. Edward Griffin; "When you give someone the power to print money out of nothing, don't be surprised when they....print money out of nothing".

All world's currencies, I tend to think, are being devalued, just not as quickly as the USA's currency.

 

[Mesogen]

oil is a globally traded commodity.

George W. Bush was correct when he said that the price was high because of supply and demand. This is true. The Iraq War caused a drop in production, basically cutting off the 2nd largest oil reserves in the world.

Ron Paul was correct when he said that the price is high because dollars are devalued. While oil is $120 a barrel, it's like 65 Euros.

 

[Zippyjuan]

Found one chart which compares the price of oil in dollars and the price of oil in Euros (the price in dollars was converted to Euros based on the USD/ EURO exchange rate) since oil is typically priced in dollars). The red line is dollars, the blue one Euros.

Source: http://www.swivel.com/graphs/show/24422647

 

[luke-gr]

Thanks all! That paints a better picture for me and makes sense to boot.

 

[JRuc33]

Its called a bubble.

 

[tmosley]

Its called a bubble.

You keep using that word, I'm not sure that you know what it means.

 

[JRuc33]

The price of oil was up 100% in one year. That's a bubble. It cannot remain that high. The US dollar is not in that much of a free fall to warrant these kinds of prices. My price target is $80 dollars.