The US has recently taken over Iraq which is a major oil producing nation, so why has the price of gas (petrol) gone up?

dj168

Because Demand is more than Supply. And Saudi Arabia is refusing to pump more oil. And oil companies are said to be GOUGING oil prices. Then there is instability in oil producing nations. And then China and India are using more oil and wanting more too. Thus making it more expensive. There are BILLIONS of reasons. http://knowledge.wharton.upenn.edu/article.cfm?articleid=1466 Apr 12 08, 5:19 PM

star_gazer

Thank you dj168, I'm sure one of those reasons is incompetence. http://www.boston.com/news/nation/articles/2006/11/29/gingrich_calls_iraq_war_a_failure/ Apr 12 08, 5:44 PM

skilburn

There is a strong link between oil production and the demand from China and less so from India as these two countries start to have a developed middle class with expendable income. http://www.euromonitor.com/Chinas_middle_class_reaches_80_million With that growth comes demand for luxury goods and that means more demand from oil. The following graph shows China's oil deficit compared with the price of fuel in the USA. http://www.savingcivilization.org/images/stories/China-Oil-Deficit.png There is a direct comparison with China's demand and US (and global) oil prices. Comparing China's rapid growth is easy with this graph which shows the amount of concrete China is using to build it's expanding infrastructure. http://www.theoildrum.com/uploads/12/cement_production.jpg All that incredible growth is going to need a comparative increase in fuels. All that concrete is going to need a lot of fuel to get it where it is needed. This graph shows the increase in liquid fuel production between 2002 and 2008. http://www.theoildrum.com/files/2008_march_oilwatch_drum_2.png As you can see, there has been an increase of 10 million barrels per day which equates to an 11% growth of production. Unfortunately for the consumer, fuel production is not keeping up with demand and the price will continue to increase for the foreseeable future. It's not all bad news though because if the world enters a recession, demand for oil will decrease and hopefully OPEC will be forced to reduce the price of oil. http://www.voanews.com/english/2008-04-09-voa56.cfm There are many more factors involved with the macro-economics of oil prices, but these are the main ones at the moment. Bear in mind that a significant amount of the global trade market is based on oil. If that trade slows, as it will in a recession, then we should see it reflected in oil prices. Apr 12 08, 7:15 PM

MonkeyOnALeash

It has NOTHING to do with supply and demand. There a THOUSANDS of wells tapped and capped across America, yet we still rely on Foreign Oil. It is about profit and power. Exxon/Mobil PROFITED $1300.00 per SECOND in 2005 http://money.cnn.com/2006/07/27/news/companies/exxon/index.htm Any other "belief" is a result of misinformation better known as The Evening News. Research is paramount in forming ideas. Something that the General Public knows NOTHING about. Tell them that the sky is green for long enough and they will believe and repeat it! Apr 12 08, 10:19 PM