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.
“We’re only a headline of significance away from $100 oil,” said John Kilduff, an analyst in the New York office of futures broker Man Financial Inc. “The unrelenting pressure of increased demand has left the market a coiled spring.” New disruptions of Nigerian or Iraqi supplies, or any military strike against Iran, might trigger the rise, Kilduff said in a July 20 interview.
Higher prices will increase revenue for energy producers from Exxon Mobil Corp. to PetroChina Co., while eroding profit at airlines including EasyJet Plc and railroads such as Union Pacific Corp. The U.S. and other oil-importing nations risk accelerating inflation, while higher energy costs threaten to restrain growth.
Interesting, but I’m not sure why it is posted on this blog. I assume it’s theologically or ecclesially significant? If not, why not? If so, is it good news or bad news? Does it somehow symbolize the fossil power not only of oil-rich Nigeria but of its Anglican leadership?
Since I live in the United Arab Emirates this is good news. It’s good news all around, really. Strong demand for petroleum is a symptom of a very healthy world economy. We should be glad for the economic growth that is happening in China and India.
As to whether there will be $100/barrel oil, I doubt it. The quantity supplied is elastic with respect to price. Further, there is still a bottleneck at the refining stage. So the increase in demand for refined products will not filter down to much of a pull crude. Instead refiners will profit from the scarcity of capacity.
#1, who said this blog is only about theology and church issues? Kendall posts what interests him and what he believes will interest others and stimulate good discussion. Take a look at the blog description statement over in the sidebar:
[i]A free floating commentary on culture, politics, economics, and religion based on a passionate commitment to the truth and a desire graciously to refute that which is contrary to it….[/i]
Before oil reaches that price, one will see a great uprising demanding drilling in ANWR and building new refineries (some of the existing refineries were temporarily shut down recently due to flood-conditions in Texas).
Oh! Yea….of course you all know that it it’s THAT expected….then everybody is “in” and “buying”…
If it were that easy, everybody would be rich.
Of course the projection ignores the fact that there is something like a 200-year supply of oil in tar sands and oil shale, the largest reserves of which are in the US and Canada, and they become economically viable at $40-50/bbl.