How the oil and euro turmoil will strike home

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October 1 2000 MONEY IRELAND

The high price of oil and collapse of the euro have hit profits at big firms. Nick Gardner explains what is going on

How the oil and euro turmoil will strike home

Cash-flow: Irish wages could grow by up to 7.5% but companies may find it harder to make ends meet ) FINANCIAL markets have been hit by a series of economic blows recently. Oil prices have risen way above their target levels, the euro has tumbled and some of the world's biggest firms, including Gillette and Intel, have issued profit warnings. What is causing these crises? Here is an investor's guide to the world's troubles. 1 Why has the oil price gone so high?

It is a simple supply-and- demand equation. When the world economy is firing on all cylinders, as it is now, with Japan, Europe and America all showing healthy growth, companies need to produce more goods to satisfy demand from consumers and businesses. As the fuel crisis showed, the world's economies depend on oil and its end-products such as petrol and heating oil.

The decision by America to release some of its oil reserves has helped push down the price from a high of $34.55 to $30.65 today, but there is still a threat that the price could go back up. If world economies continue to grow, demand for oil could increase further.

snip

http://www.sunday-times.co.uk/news/pages/sti/2000/10/01/stimoimoi03005.html

-- Martin Thompson (mthom1927@aol.com), October 01, 2000

Answers

This ia a fairly long article but with the current glitch in the Grenspun system I am unable to post the whole thing. Maybe a few notes to y2kgicc@yahoo.com could shake something loose. It is a fixable problem at MIT but sometimes it hard to get their attention.

-- Martin Thompson (mthom1927@aol.com), October 01, 2000.

Geez, Martin, I'm scared enough now. Aren't you celebrating Halloween a bit early?

-- JackW (jpayne@webtv.net), October 01, 2000.

It seems like nothing but bad news is piling up lately.

-- Nancy& (nancy7@hotmail.com), October 01, 2000.

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