Remember oil?

On any other week the rise in the price of oil would be top of the headlines says Betonmarkets.com's Michael Wright. Oil prices reached record highs for the seventh straight session last Wednesday after refineries in California and Texas said they had new outages and the government reported surprisingly large declines in oil inventories.

Most of the traders have blamed the rise in price for oil on the fact that
oil refineries have been shutting down some of their refining systems for maintenance while others have broken down. Even during the week of Hurricane Katrina oil prices stayed below the 77$ mark, a level that has been surpassed this week easily.

Oil prices have a direct effect on consumer spending, with consumers
flinching at price at the pump. Eventually oil companies and petrol stations pass on these price increases meaning it can have graduating effect on the nation's finances. As a result they go out less, and try to stretch their remaining money by spending less on frivolous items. The retail corporations on the other hand will feel the pinch twice as hard, as not only will their sales will be decreasing, their operating expenses will be increasing due to a higher heating bill.

As for relief on the oil price, there doesn't seem to be any help in sight,
while the hurricane