$100/bbl Oil

Two more reports of sky high oil prices surfaced in the last few days.  In a Guardian story Matt Simmons warned that oil prices would reach $100/bbl within six months.  A Bloomberg article indicated that options trading contracts show that $80/bbl oil is possible by year end.  These two reports follow crude oil reaching a record $60.95/bbl in New York on June 27 and increased concern over expansion of the Mideastern conflict.  An earlier report that OPEC may not be able to meet Q4 demand and that Goldman Sachs had predicted a super spike of $105/bbl were previous indications that oil prices are going to continue to rise.

I am beginning to sound like a broken record.  Is anyone in government paying attention to this?  I certainly don't know when and how high oil prices are going to go, but it certainly has me worried.  If the permanent outstripping of demand over supply were to occur this year, we are so unprepared that the economic effect would likely be catastrophic, possibly sending the world into the worst depression ever.  I have never been an alarmist, but the apathy towards peak oil has made me one.

Technocrati tag: peak oil

Comments

[BIll Harris]

I invite those not sure if such a thing is possible to read "Out of Gas: A Systems Perspective on Potential Petroleum-Fuel Depletion" (http://www.pegasuscom.com/AAR/model5.html). While the text of the column merely describes one possible scenario, the downloadable simulation offers a way to explore what might happen and what the ramifications might be. I'd welcome your feedback.

[OilGuru]

The real issue is that most (e.g. the media) are focusing on the price of crude oil when they should be focusing on refinery capacity and the demand for refined products. Crude oil inventories are adequate (at least for the time being) the real problem is that over the past 20 years we haven't increased refinery capacity while the demand for refined products has increased significantly. The solutions are increasing refinery capacity and reducing demand for refined products, not increasing crude oil production.

The government is paying attention but they have little to no control. What can they do when the domestic price of crude and refined products are based on the global energy markets?

[OilGuru]

And regarding the Goldman Sachs prediction of $105, take it with a grain of salt. It was published by their equity (stock) research department, not their commodity group. It was simply an attempt to back up their position that the stock prices of the major oil companies are/were undervalued based on the potential for high crude oil prices. To generate revenue, Goldman, needs to take a publish an opinion on the market and convince their clients to trade based on said opinion, nothing more, nothing less. While they haven't been as well publisized because it's not as "shocking" there are quite a few firms (e.g. Andy Xie of Morgan Stanley, see http://www.morganstanley.com/GEFdata/digests/latest-digest.html#anchor0%22) have stated that they think oil prices will decline.

[energylens]

Might this article on Repatriation of the Dollar:
shed some light on why no one in gov't is "paying attention"? Perhaps $100/barrel is the real goal?

[الاندرويد]

its a high number it maybe getting higher this days

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[temporary internet miami]

wow, I knew this would happen, that's why the last year I bought a hybrid car, and until now is the best thing ever

[Invertir en oro]

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