Thursday, November 15, 2007

Let Oil Prices Rise

Let Oil Prices Rise: "Opinion security business November 13, 2007 Let Oil Prices Rise By Lawrence Walsh As crude passes $100 per barrel, IT professionals have the opportunity to provide efficiencies that will keep their businesses healthy and growing.

Oil is pushing $100 per barrel and will likely pass the century mark this week. The national average for a gallon of gasoline is already above $3 (and rising). With increasing fuel costs come price hikes in commodity products—food, raw materials—and services—transportation and shipping. All this gives rise to worries about inflation and a slowing of the economy.

Helge: Food is more expensive in the future. We need to take out the transportation and transaction costs from food. Locally produced food has an opportunity. We need better food and less processing.

Reality is economic productivity remains healthy. Inflation is relativity stable. And the cost of finished goods and raw materials is increasing, but not at a rampant pace. The reason: operational efficiency brought about by effective use of technology. In this sense, higher oil prices are a good motivator for enterprises and their IT departments."

Oil shortage could or may lead to increased costs for many finished goods. (Oil is not used just for fuel, but is a basic material in many products we take for granted—polymers, chemicals, plastics, paints and packaging.)
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