Though it seems motorway service stations are no longer obliged to post their prices on the carriageway, other service stations do. Petrol is the most visible price in the economy. It is also the classic reluctant purchase. Who spends £80 filling up the car without thinking they would rather spend the money on something else?
Retail sales jumped 1% on a seasonally adjusted basis last month, the Census Bureau reports. That’s the best monthly gain since last October’s 1.6% surge. It’s also the eighth straight monthly increase. Consumption, in other words, is doing fine. But quite a bit has changed on the global stage in recent weeks, namely, the Mideast turmoil and resulting jump in oil prices. The question is whether February data is dated?
Caroline Baum goes after the confused thinking on oil prices and inflation:
It must be the noxious fumes or the stratospheric prices because crude oil crossing the $100 threshold makes normally thoughtful individuals funny in the head.The early symptoms of high oil price syndrome, or HOPS, can easily be masked or confused with a more generalized form of lazy economic thinking.For example, those afflicted with HOPS start making assertions that higher oil prices are inflationary, as if relative price changes can morph into an economy-wide rise in prices without help from the central bank.
This morning’s latest on weekly jobless claims is a bit of a setback, but it’s too early to panic. For one thing, last week’s seasonally adjusted 26,000 jump in new filings for jobless benefits is small for this series, given how much it bounces around from week to week. That argument won’t wash with the thousands of newly unemployed, of course, but as a macro matter there’s nothing particularly worrisome in today’s report. That is, until you start looking beyond the data.
Summary: Friday might be an important day, perhaps the most important day of the decade. It’s the Day of Rage in Saudi Arabia. The Princes have mobilized their vast security services to prevent or disperse the protests. Will anybody dare to show up? Will the Princes order the use of force? Will the crowds resist? The consequences could send oil prices skyrocketing, shaking the world. Many have guesses but nobody knows the outcome.
One key question in determining the impact of instability in Libya and elsewhere on world oil markets is how much other countries can and will increase production to offset the shortfall. Here I review the critical role of Saudi Arabia in past disruptions and discuss the current situation. Prior to the First Persian Gulf War […]
Summary: Confidence provides strengths for a society, but only when coupled with clear vision. Unfortunately modern America too-often sees the future only in terms of doomsters’ pessimism and advocates’ optimism. Here we have a case study of the latter.
Change is on the way in the Arab world, with Egypt the latest focal point. Here I review recent events and their implications for world oil markets.
Source: Google maps.
After over fifteen years on the drawing-boards, the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project was approved by the four countries’ leaders, meeting in Ashgabat in December. While the intergovernmental agreement naturally depends upon follow-on negotiations to be realized, it is anticipated that sales and purchase agreements will be signed at another four-way meeting that could take place as early as April 2011. The success of such a project would continue diversification of Turkmenistan’s gas export directions, provide needed resources to gas-hungry Pakistan and India, and not least give Afghanistan a keystone development project upon which to build economic reconstruction.
On Friday Reuters reported:
Rising gasoline prices beat down U.S. consumer sentiment in early January, overshadowing an improved job outlook and passage of temporary federal tax breaks, a survey released on Friday showed. A year-end surge in gasoline prices ratcheted up consumer inflation expectations to their highest in more than two years, according to the latest data from Thomson Reuters and the University of Michigan. The surveys’ preliminary January reading on the overall consumer sentiment slipped to 72.7, below 74.5 in December. It fell short of a 75.4 reading predicted by economists polled recently by Reuters.