World and the great Oil Saga

While Oil is making the headlines for all the reasons, it has definitely shaken the world. Its not a problem which US is facing alone but economies of world have been brought to their toes in absence of right solution.

Last day was filled by headlines like
President Bush Calls for More Oil Exploration at
Bush Says Saudi Oil Boost `Not Enough' to Ease Prices (Update1)
Saudis protect own interests in oil production
there was things standing out clear and simple- One- we are in a deep problem and second- world has to face it one day or the other.

When we say we are in deep problem its because at this point each country is feeling the heat. Its not only US President running to resolve it but even in India government is facing lot of pressure to control inflation. We have to face it one day because its a non-renewable resource of energy.

While I would not talk of second aspect but first one is problem of our own making. US economy is running toward recession due to subprime and it has its impact all over the world. Its not only the Bear Sterns which has gone bankrupt but it has its feelers around the world. The weak dollar has made the oil costly and has affected economies which is heavily reliant on dollars. Companies are awakening up to this reality of unstable dollar and even have shifted the hedging to euro or more stable currencies.

Now question in mind is where is the solution. well the solution of problem is again adjustment of global economies in time to come. Only thing to watch out is where the balance would tilt- would it be again US or emerging of new powers like China or India.