Oil price hike: need for long-term energy strategy

For the fourth time since the early 1970s, oil prices have shot up and touched a level of 37 dollars a barrel. On this occasion, however, the increase has not been brought about by any specific political upheaval, such as the Arab-Israel War in 1973, the Iranian Revolution in early 1979, and the Gulf War in 1990. In fact, there have been signs of an impending hike in oil prices for at least the past 18 months, and an increase to levels above 30 dollars a barrel seemed likely. However, even the Organization of Petroleum Exporting Countries has been taken by surprise by the magnitude and dimensions of the increase. The main factor behind the current hike is the surge in demand that has taken place during this summer. Refineries, particularly those in North America, have been working at full capacity to satisfy the increasing demand. But they neglected production of heating oil and concentrated on producing gasoline and diesel oil, leading to very low stocks of heating oil. Full Text