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2.7%  Q1 GDP    4.57%  avg. 30-year mortgage     9.5%  Unemployment

Oil Demand Falls in 2008

It's hard to imagine that this is happening the same year that the price of oil hit an all-time high: The International Energy Agency today said that global oil demand will actually shrink .2 percent this year. Yes, oil hit a high of $147 a barrel this summer but the global economy has deteriorated so quickly that oil itself is now falling into a recession of sorts.

The IEA, which represents the interests of 28 oil-importing nations, also cut its forecast for global demand next year, saying a rebound in demand depends on economic recovery in the second half of 2009, the Associated Press reports. Crude oil today is trading at $44.85 a barrel.

In other news this morning, South Korea's central bank cut interest rates to 3 percent -- the deepest cut in the country's history. And in Europe, Sweden announced a $3.4 billion bailout for its auto industry.

Global stocks are mixed so far today. In Asia, the Nikkei and Hang Seng were up slightly, but the DJ Shanghai index fell 2.5 percent. In Europe, the markets are flat, stalled out in either slightly negative or positive territory. The DJ Stoxx index is down 1 percent.

--Sara Goo

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By Sara Goo  |  December 11, 2008; 7:28 AM ET
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Oilmen are about the only parties to enjoy "Boom to Bust" economies. Detroit has never enjoyed boom to bust mentalities and yet the results turn out to be progress through necessity.

In the last great cycle, engines with carbeurators were outlawed by 1985 however European automobile producers were putting out fuel injected engines in normal production back to the 1970s, refer to Volvo.

Oh there were mistakes too, in my world at least, like forced adaptation to metric sized bolts and such.

Someone else came along later and increased the national speed limit to 65mph. Certain states did not like that idea yet were forced to adopt faster highways lest federal funding would be yanked. Funny thing is that refineries did not keep up with newer demands created by more vehicles on the road moving faster. That entire situation with refinery and storage capacity in the United States looks like Cartel behavior to me.

Posted by: truthhurts | December 11, 2008 9:19 AM | Report abuse

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