My thoughts on Oil Price Hike

I like being able to watch the news and other Filipinos soaps and sitcoms on this website, I get to pretend that I am home even for just an hour or two a day.
I watch TV Patrol every day here, just like I do back home. I find it amusing how this one bloke said that the government should do something to stop further oil price hike. Another person said the eVAT on oil should be completely removed. They are laughable in my opinion. I understand their sentiments but at the same time, I also understand that the Philippine government has absolutely no control on oil prices because it is dependant on the World Market. Even here in the United Kingdom, petrol prices have doubled and of course the British people have the same sentiments but they do not suggest laughable solutions like Gordon Brown should stop the oil price hike. The people here are more educated and even though they are worried of possible impending inflation, they don't do barbaric things like punching a punchbag with the president's face on it or throwing tomatoes on her poster. To be honest, if they are so worried about money, they should just feed those tomatoes to their children instead of wasting it on a stupid poster.
The majority of the people in the Philippines do not understand that this is a worldwide problem that can not be resolved by surpressing the oil prices hike because that is just beyond their control. But I'm sure there are other ways to keep the economy together inspite oil prices going skyhigh. The people in the Philippines should be educated about things like this so they don't just rely on what rubbish the media feed them.

It's not only the Philippines

Zimbabwe to Introduce $100 Billion Bank Note
By VOA News 20 July 2008

Zimbabwean foreign currency dealers conduct transaction using money stashed in cooler box in Harare (Oct 2007 file photo)
Zimbabwe will introduce a $100-billion bank note as the nation continues to struggle with the world's highest inflation rate.The latest addition to the country's currency will begin circulating Monday, less than a week after Zimbabwe's bank chief announced the country's inflation rate had skyrocketed to 2.2 million percent.The Reserve Bank of Zimbabwe released six other high-value notes earlier this year, including a $50-billion note in May.Zimbabwe's economy is in a free-fall with 80 percent unemployment.The country, which is in the middle of a political crisis, is also suffering from chronic shortages of food, fuel, and other basic goods.Critics blame the troubles on the policies of President Robert Mugabe, especially the seizure of white-owned commercial farms.Mr. Mugabe blames interference by outsiders, led by former colonial power Britain.Some information for this report provided by Reuters and AFP.


(source: BBC News Website)
Inflation at 11-year high of 3.8%

How shoppers are spending in one major retail centre
Rising food and fuel costs pushed UK inflation up to an 11-year high of 3.8% in June from 3.3% in May, figures show.
The rise means inflation is now well above the government's 2% target, and may reduce the chance of a UK rate cut.
The Bank of England, which has already said inflation may top 4% this year, has to balance the need to control inflation with worries over growth.
The RPI inflation measure - often used as a benchmark in pay negotiations - rose to 4.6% in June from 4.3% in May.
The annual rate of inflation is at its highest level since 1997, when the Office for National Statistics started using its current methodology to calculate the figures.
However, inflation is still way below levels seen in the early 1990s.
Restraint
Commenting on the figures, Chancellor Alistair Darling called for wage restraint in order to help rein in price growth.
"We saw what happened in the past when inflation got out of control and people found that every penny they got in a wage increase was swallowed up by food and fuel prices going up," said Mr Darling.
"Whether you are in the private sector, or public sector, whether you are sitting in the board room or working on the shop floor, we cannot allow inflationary wage increases because that would mean that everyone, especially people on lower incomes, would suffer," he said.

Retailers are facing tough conditions on the High Street
But the high inflation figures drew criticism from the Conservative and the Liberal Democrats, who questioned Mr Brown's effectiveness in his former role as chancellor.
"Inflation is now more than double the rate that Gordon Brown inherited from the last Conservative government," said shadow chancellor, George Osborne, who also accused Mr Brown of "shrugging his shoulders" over the economic woes.
Liberal Democrat Treasury spokesman Vince Cable said the data proved Gordon Brown had lost his focus while chancellor.
"Gordon Brown is now facing the consequences of years of inaction over spiralling personal debt and the unsustainable bubble in the housing market," said Mr Cable.
"The Prime Minister bases his credibility on his economic record, yet it is now becoming startling clear he was asleep at the wheel."
Cheaper clothes
Food and non-alcoholic drinks were the main factors fuelling the rise in inflation, with prices increasing at a record pace of 9.5% in June from the same month a year earlier.
The fact that the economy's slowing will bring inflation down, but not till next year
John Cridland, CBI
Inflation rise: key points
Seven families living through the credit crunch
When compared with May, food and non-alcoholic drinks were 2.1% higher.
Meanwhile, surging oil prices have driven up the cost of fuel with the average price of petrol increasing by 5.3 pence a litre.
One positive for consumers during the month was a drop in the cost of shoes and clothes as retailers cut prices in an attempt to attract more business.
Rate dilemma
The inflation figures, which came in above forecasts for the third month in a row, mean that the Bank of England is now likely to have less opportunity to cut interest rates.
The Bank is currently trying to balance growing evidence of an economic slowdown against the problem of rising inflation.
"The Bank of England can't cut rates until it is convinced inflation is moving downwards," said James Knightley, economist at ING.
However, the British Chambers of Commerce (BCC) warned it would be a "serious mistake" if the Bank's Monetary Policy Committee (MPC) decided to tackle rising inflation by raising rates.
"Further increases in CPI inflation, to levels above 4%, are inevitable in the next few months whatever the MPC decides to do," said BCC economic adviser David Kern.
Economic gloom
The inflation figures add to mounting bad news for the economy.
Earlier on Tuesday, the British Retail Consortium said that like-for-like sales on the UK's High Streets were down 0.4% in June compared with a year earlier.
On Monday, figures showed that factory gate prices - a measure of how much manufacturers charge for their goods - rose 10% in the year to June, the first double-digit annual rise for more than 20 years.
However, the CBI business group said that while UK businesses will be facing a few "tricky" months as consumers tighten their purse strings, there could be a "silver lining" in store for the economy.
"The fact that the economy's slowing will bring inflation down, but not till next year," said CBI deputy director general John Cridland.


South Asians face fuel price rise

Many Pakistanis are angered by power cuts and a recent food price hike
Bangladesh and Pakistan have both sharply raised fuel prices again as the cost of crude oil continues to soar.
Diesel and kerosene are up by 37.5% a litre in Bangladesh, while the price of a cylinder of cooking gas is up by 66%.
In Pakistan, natural gas prices rose by up to 31% on Monday, a day after petrol and diesel prices went up by 10%.
Rising fuel costs are contributing to higher food prices around the world. Millions of the poorest people in South
Asia have been badly hit.
Over the past year Bangladeshis have already seen the price of staple foods like rice double - and the government is appealing for global action to curb surging crude oil prices.
Analysts say the unpopular price rises could curb demand - and in turn help to bring down the oil price.
Hunger in Bangladesh
The BBC's Mark Dummett in Dhaka says the latest rises are a further blow to Bangladeshis, 40% of whom live on less than $1 a day.
He says with diesel going up to 80 US cents a litre, the cost of transporting food and other goods around the country will become much more expensive.
Fuel prices were last put up in April - but the government said it had no choice but to increase them again, given the recent global oil price rises.
Otherwise, funding of health, education and government services would have been cut, the finance minister said.
Even so, he said it would still spend almost $1.5bn on subsidising fuel during the next year.
It is also committed to help feeding millions of poor Bangladeshis who can no longer afford to eat three meals a day, our correspondent says.
The government is describing it as an international crisis.
"We think rich countries, oil-producing countries and the United Nations should deal with the issue urgently," deputy energy minister M Tamim told the AFP news agency.
Inflation
For Pakistanis the rise in the price of petrol was the fifth in four months.
A litre of petrol now costs 75.69 Pakistani rupees ($1.11), compared with 53.70 in February.
Diesel is now 49.05 a litre and a kilogram of compressed natural gas, which many people in South Asia use for cooking, costs 52 rupees.
Soaring oil and food prices have pushed inflation in Pakistan to its highest level in more than 30 years.
Many poor and middle income people there are also struggling as prices soar.
Acting Petroleum Minister Shah Mehmood Qureshi said different prices would be charged for gas, depending on how much consumers used.
Mr Qureshi said the formula meant that nearly 91% of the total 5.4 million domestic gas consumers in Pakistan would not be affected by the price rise.



What is keeping oil prices so high?

Fears of disruption to supplies is one factor behind the sky-high price
Despite an emerging global consensus that oil prices are dangerously high, there seems little chance of the cost of oil falling significantly in the near future.
Analysts say measures agreed at Sunday's crisis summit in Jeddah are unlikely to have a dramatic impact on market trends.
But what is keeping prices close to record levels of almost $140 a barrel?

WEAK US DOLLAR
The sharp jump in prices since 2005 has coincided with the plunge in the value of the dollar against other leading currencies
Dollar weakness encourages financial investors to look for other more lucrative investment opportunities, with oil top of their list
As oil is traded in dollars, it also makes it cheaper to buy
Signs the US economy may be on the brink of recession have undermined the dollar, boosting prices. Prices rose $11 on a single day last month when the unemployment rate rose

SUPPLY CONCERNS
Analysts say growth in global supplies is worryingly failing to keep pace with growth in demand
Supplies from countries such as Russia are thought to have peaked and finding new sources of oil is difficult and expensive
Increasing reliance on members of the Middle-East dominated oil producers group Opec, many of which are already pumping as much oil as they can
Saudi Arabia is one of few countries with spare capacity but it has been reluctant to boost output substantially

DEMAND GROWTH
Global thirst for oil is intense. Demand has risen by about 3 million barrels a day since 2005 and is expected to rise by 32 million barrels a day in the next two decades
The US remains the world's largest oil consumer and high individual fuel usage continues to put pressure on crude stockpiles
Fast-growing China and India are forecast to account for 40% of the growth in oil demand by 2030, as industry grows and demand for travel increases

POLITICAL INSTABILITY
Much of the world's oil is concentrated in volatile regions, leading to fears of frequent and unpredictable disruptions to supplies
Despite oil output being at a six-year high, Iraq is still beset by violence while militant groups in Nigeria's main oil-producing region have recently impeded about a quarter of its output
Tensions over Iran's nuclear programme. There are fears that an Israeli attack on Iran's nuclear installations could trigger a wider conflict and threaten traffic through the strategically vital Strait of Hormuz, used to ship 40% of the world's oil.

MARKET SPECULATION
Oil exporters say the price surge cannot be explained by the fundamental ratio of supply to demand and point their fingers at market speculators
It is claimed that some traders are making huge amounts of money betting on the direction of prices, in turn forcing prices higher
Others maintain that traders are simply hedging their investments against future market developments to reduce risk
US regulators are looking for evidence of market manipulation while the IMF is examining the role of traders in the price spike