Crude oil is now down nearly $20 per barrel from its recent highs. As a guestimate, I would say it’s down about 21% from its high this year.
The real question is: how long can we continue with subdued inflation? I read a front page article in today’s WSJ about how inflation is at a 44-year low. The WSJ claims this is a “sign that high unemployment and excess production capacity are holding down wages and prices in much of the developed world.”
I also found this little tidbit from the article interesting:
“Wednesday’s U.S. inflation report offered evidence that retailers are holding off on price increases, even though prices of raw materials ranging from lumber to cotton are rising amid strong demand from Asia.”
Eventually prices have to rise.