Oil Hits $80 a Barrel for First Time

Oil prices rose Wednesday to a record-breaking $80 a barrel.
OPEC made the decision Tuesday to boost crude production by 500,000 barrels, but the tightening of oil supplies caused a spike in oil prices, according to the Energy Department’s Energy Information Administration.

Of course, the current price is below the inflation-adjusted highs of early 1980, in which $38 would be comparable to $100 today. Regardless, it’s just a matter of time before those prices actually DO hit $100, something of which most seniors and retired CEO’s of major oil co-operations never dreamed of seeing in their lifetimes.

NEW YORK (AP) — Oil futures prices rose sharply Wednesday, briefly climbing above a record $80 a barrel after the government reported a surprisingly large drop in crude inventories and declines in gasoline supplies and refinery activity.

The report from the Energy Department’s Energy Information Administration suggested oil supplies are tightening as demand remains strong. That’s why oil prices are rising despite OPEC’s decision on Tuesday to boost crude production by 500,000 barrels per day this fall, analysts said.

Despite Wednesday’s jump, oil is still well below inflation-adjusted highs hit in early 1980. Depending on the adjustment, a $38 barrel of oil in 1980 would be worth $96 to $101 or more today.

Posted by grady