Monday, May 21, 2007
Wowza,
BBC News: Nigeria attack sends oil over $70
If this aint inflationary, then what is? As mentioned earlier, America has not begun her driving season, the hurricane season is yet to get underway, inventories are low, production is at a plateau, Iran is a tinder box waiting to explode and there is little sign that Nigeria will cool down any time soon. Could events combine this summer (or next) to bring oil above $80/barrel, with $5-10/barrel changes in a week relatively commonplace at the moment, why not $90 or even $100/barrel. This must be what King referred to when he seemed to imply that energy prices could create a situation where 5.75% isn't enough.
Posted by pr @ 01:54 PM (333 views) Add Comment
1 Comment
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1. Rickyb said...
I can't see the oil producing nations letting oil get to more than $80/barrel and sustain these prices for long. This is because above $60/barrel, the synthesis of oil products from coal starts to become economically viable. Oil producing nations are unlikely to want companies to start investing in synthetic petroleum plants while they have oil reserves which are economically recoverable, and they will therefore try to ensure that the long term price stays low enough despite the occasional peaks that we see from time to time.