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July 26, 2005
Soaring Oil Prices, Fluctuating Economies, and Uncertain Times
By:
According to a Reuters report, "High energy costs and the possibility of more negative earnings may curb investors' appetite for stocks this week, while the (US) government is likely to report the economy slowed in the second quarter. Even companies that manufacture disposable diapers like Kimberly-Clark Corp are beginning to reel under "higher oil, resin and marketing costs." Up to 6,000 jobs are expected to be slashed. In the longer run, taking care of babies is going to cost more when you factor in hikes in other essential products as well.
Oil companies though are having a ball, but they seem to be the exception.
Even France's PSA Peugeot Citroen, Europe's second-largest carmaker is finding it hard to balance its new model line with "higher raw material costs." (FT.com, July 26).
U.S. consumers are already getting savvy about the possible gloomy propects ahead. Within a month, their "confidence slipped in July from three-year highs reached in June as consumers took a more mixed view of their job prospects." (Reuters, July 26).
Right now, we seem to be in the sea-saw face, though the mid to long-term prospects may hinge on geopolitical issues and the development of alternative power sources. From where I stand, they are both tied. Of course, there is a lot more going on. Watch this space.
Mathew Maavak
Panoptic World
Posted by Mathew at July 26, 2005 9:54 AM Category: Peak Oil