Finance Wanted.

By James McKerr

What effects the price of oil, and keeps pushing prices up can be used to make money. Much is being made in the press about increasing oil prices and the knock on effects on the wider economy and eventually on our disposable incomes.

Oil prices have increased from around $10 per barrel in 1999 to over $140 just a few days ago. The effects these price rises have are far reaching. As most people know they cause gasoline prices to rise. In addition energy costs to heat and light our homes also rise. However perhaps more unnoticeable is the increases in prices of other goods such as foods and consumer retail items such as clothes, electronics and consumables. Oil and oil derived products are used heavily in the production of many materials such as aluminum as well as virtually all plastic goods.

All forms of transportation are now more expensive meaning that the costs of transporting all of the goods we buy has gone up. Unless companies can absorb these costs they are usually passed on to us the consumers in the form of higher prices.

Investing in oil is a great way to offset these higher costs

Choosing the right form of oil investment is crucial if you are to maximize your gains. Much of your final decision will be depend ant on how the rest of your investment portfolio is structured. If you are over weight equity stocks already you may opt for an oil Exchange Traded Fund (ETF) which tend to be less correlated to worldwide equity markets. If you feel these types of funds carry too much risk then simply investing in an oil related company may suit your needs better.

To learn more about what effects the price of oil or to learn more about the different ways to invest in oil follow these links.