Part of the increase in average floor valuation for a barrel of oil is a reflection of the devaluation of the dollar. Another component of the long term average increase in price of oil is due to increase overall demand vs the ability to produce it.
Lee
of MD
@
Aug 21, 2008 16:31:17 PM
But the floor gets higher every cycle
The petroleum industry has been a cyclical one since its beginning. The rise and fall of oil prices, even dramatically so, isn't new. What does seem to be changing, though, is that when prices fall, they don't quite fall to earlier lows. Prices may have peaked for now, but a floor of $90-%100/barrel would have seemed outrageous less than ten years ago. And at those prices, the oil service companies will likely stay very busy for a good long while.
Lee of MD @ Aug 21, 2008 16:31:17 PM
Daisy of TX @ Aug 19, 2008 10:57:06 AM
Back to article