July 23 (Bloomberg) -- The $100-a-barrel oil that Goldman Sachs Group Inc. said would prevail by 2009 may be only a few months away. Jeffrey Currie, a London-based commodity analyst at the world's biggest securities firm, says $95 crude is likely this year unless OPEC unexpectedly increases production, and declining inventories are raising the chances for $100 oil. Jeff Rubin at CIBC World Markets predicts $100 a barrel as soon as next year. http://www.bloomberg.com/apps/news?pid=20601087&sid=aYjwn7IqTlHQ&refer=home
the political fallout will be tremedous, and you can bet the GOP candidate wont win the election. It would nail the coffin. I wouldn't be surprised if oil is sold hard as we approach the election back below 60 dollars. Its a rigged system, then the GOP candidates can point to the declining oil prices. The whole power structure is interconnected with the financial markets.
I still can't believe that crude broke under $50 just this past January (and RBOB gas at $1.35). I knew those were such unbelievable prices at the time. In fact, it was those very prices that convinced me to start trading futures. I was a little late to the game, but it was very rewarding nonetheless.
The world is awash in crude oil, and the U.S. especially is. Manipulation of world oil prices by traders is a thinly veiled crime. I especially love how the "kidnappings" of oil workers in the Niger Delta spikes oils prices - as if those platforms in Nigeria couldn't be secured with the greatest of ease.
I've heard this theory quite often. My question is, for years and years oil languished in the mid-teens to mid-$20s, where was all the manipulation then? You'd think these theorized manipulators would have much more of a reason to drive up prices back then (when supply was truly in excess). A ramp up in Asian energy consumption, coupled with a dwindling buffer between global supply & demand (along with USD depreciation) triples the price oil in a matter of years. Suddenly it's all the manipulators' fault?
I find it interesting that when oil prices are high, many blame evil energy manipulators and attempt to use economics to justify lower prices. Yet when the price is low, the masses simply forget to have an opinion. The evil energy manipulators join the bandwagon when oil companies start making big profits, or vice-versa. In the offpeak season, I guess they're unemployed. My theory is China and India are growing @ 8 to 10% per annum, and their economies are being modernized. That's a huge demand on oil consumption. Supply is growing nowhere near as fast, and in fact many existing wells are nearing depletion. New supply is slow and very expensive to develop. All the easy stuff has already been extracted. In order to ensure there is enough oil to go around, prices will rise until enough people say it's not worth it. I hear plenty of talk that oil prices are too high, but very few have sold their car and start taking the train to work. Me thinks $100 oil will be fair value soon enough.
TheKin2 hit the nail on the head. As a Geophysicist exploring for oil in Qatar (20 yrs in the business) I can tell you that oil/gas are great values at current prices. Every American should own at least 100 shares of XOM or CVX or SLB. The best hedge against $5.00 gasoline. They're paying $8/gallon in Europe... Crude is a bargain at $150/bbl. I'm so sick of Americans whining about energy prices. The Chinese and Indians are eating our lunch. Wake up and get to work America!
I don't know what most folks here think of the theory, but it seems that the theory of Peak Oil is now becoming mainstream: http://en.wikipedia.org/wiki/Peak_oil One analyst I really like: http://www.mcdep.com/
the fact that countries that DO got big reserves are quicking the exxons of the world out and using nationalized oil companies is also in play. if russia, venezuela and others were to let US big oil they couldve MAYBE kill the bull market. as things stands right now prices will surpas $100. when I have no idea