Deflation On The Way......

[ToraToraTora]

http://www.bbc.co.uk/news/business-31438213
Comments please.

[Old_Geezer]

Falling oil prices ? Just a correction not a trend. About time we had some good news regarding our wallets. It's no big deal. May they occur regularly to compensate for the continuous price climbs and keep us level (but I'm not holding my breath).

[SirOracle]

TTT.....Lets hope not. Look at Japan... defletion 20 years ago and they have still not managed to recover.

[Clanad]

I'm not sure what OG means by "correction and not a trend"... this time last year we were paying about $3.85 per gallon here in the U.S. I filled yesterday and paid $1.74... sure looks like a trend to me, especially with the Arabs saying they're not backing off of current production.

And... yes you can thank the U.S. and Canada for all the added production which has brought the supply to where it is today. Can anyone say "Fracking"?

[Old_Geezer]

Lucky you. Let me know in 2016/2017 when they are giving it away I might order a gallon or two to ship over the Pond using Amazon. :-)

No expert, but I would doubt fracking is making the major difference. I'd need convincing.

[Gromit]

I warned about this last year.

http://www.theanswerbank.co.uk/News/Question1315924.html

Its been coming for ages. Noy good.

[venator]

Don't worry chaps, if we get Labour next time, we'll have lots of nice traditional inflation, unemployment and high inflation - remember they managed toi pump bank rate up to 17%

And the top effective tax rate on "unearned income" was over 100%

I was working at KPMG at the time, I know whereof I speak...

[Peter Pedant]

Carney was predicting deflation in a year or so

bad news as noone spends as they know prices will be lower in amonth or two

[Clanad]

Here are a couple of sources, OG...

http://www.americanthinker.com/articles/2014/12/fracking_drives_global_oil_prices_down.html

... and here: http://www.bloomberg.com/bw/articles/2014-12-01/can-the-us-fracking-boom-survive-with-oil-65-per-barrel

I might add that it's not just the 'fracking" technology but hat coupled with "directional drilling" has greatly increased production as well as lowered costs. The directional drilling allows one oil rig to drill a well is a specific direction and the off of that, drill other off-shoots, if you will. This allows on primary well to produce up to the previous capacity of 5 or more conventional wells.

Here, in the western U.S., a huge new field called the "Bakken" has still not been geographically defined as to size. Along with that test wells drilling through the Bakken into a geological feature underneath indicates possibly 2 or more production zones...

[ToraToraTora]

stop it venator, you'll get gromit and co all misty eyed and nostalgic!