As the crisis in Libya continues to shake world oil markets, many voices are calling for President Obama to tap into the Strategic Petroleum Reserve. With gasoline prices up 33 cents a gallon in the last month, that's a tempting idea. It's also the wrong one.
Marathon Oil, the fifth-largest oil refiner in the U.S., is spinning off its refining business into a new company called Marathon Petroleum. Marathon Oil, meanwhile, will reduce its debt as a result of the move and will focus on oil exploration and production.
Oil prices touched a two-year high Monday on tighter inventory and expectations that a U.S. economic growth spurt will boost demand this year. Some analysts predict prices could soon gush to $100 per barrel.
Light crude oil prices have been climbing in the last few days, closing the week at $88.94 per barrel on the NYMEX. If prices climb high enough, it could damage the still-weak economy by raising the costs of gasoline, jet fuel and petroleum-based chemicals. How high is too high?
The Organization of the Petroleum Exporting Countries will leave oil output unchanged, a delegate at the group's current meeting told Reuters. Oil ministers apparently are not worried the weak dollar will drive up the price of crude far enough that it will crimp the global economic recovery.
Crude oil prices moved above $83 Monday -- from just above $70 only two months ago. There are a number of causes for the increased price of crude, among them the growth in demand for oil in China.
The mid-Atlantic region, hard hit last winter, will catch a break from the weather next time, says the Farmer's Almanac, but much of the rest of the U.S. will be colder than normal, New England in particular. For those who heat their homes with oil, however, lower prices should ease the season.
