TRUE DOLLAR JOURNAL

All too often, many get fooled by numbers. Take the recent drop in the price in West Texas Intermediate.




Far too many believe the price of oil is plunging because OPEC ministers decided to do nothing about production output. However, reality looks different.

In true terms, oil is up a bit more than 1% month to month (GW$6.08 vs GW$6.00). True oil still trades at 1.29 times the true price average ($4.73) excluding manias over the last 29 years.

However, West Texas hit an interim low of GW$5.70 on February 1, 2009. Since then WTI has gained 6.3% in true terms growing at the yearly rate of 1.1% a year.