Oil looks set to pass $150 June 8th, 2008

Oil prices ended the week at over $139 a barrel following a two-day rise of over $16. Whilst some analysts are saying the increase is merely due to speculation and prices will soon fall, the majority of commentators do not believe this to be the case. In fact the cost of oil looks likely to pass the $150 a barrel marker over the next month and could go all the way to $200 a barrel over the coming months.

The news has sparked concerns that although the economy is slowing, increasing inflationary pressures on oil, fuel and food look set to drive interest rates higher. Whilst the UK kept rates on hold, the European Central Bank has given a strong hint that it will push up rates. All in all it is not a good time for the economy and the consumer.