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Where do expect oil price per barrel to go from here?
Oil is increasing because as you get closer to supply overload, perhaps the oil price starts becoming asymptotic.
The economist said speculators couldn’t drive up the price of oil because they are simply trading ‘paper barrels’. However, all this demand for contracts has to increase demand somewhere; They buy oil, then they sell it before ‘delivery,’ but in the process they are increasing demand.
It would seem that oil price could come down fairly easily. There is 1 million barrel discrepancy between supply and demand. With people’s lifestyle changing a little bit, you could easily take out 4 million barrels of demand and then the price could really plummet to 30’s or 20’s.
Nevertheless, this would mean a constant constraint on world growth, as every time the global belly would swell a price shock would ensue; demand growth is faster than supply growth.
It will be interesting to see where it goes. Please leave your insightful comments below.
Eventually high prices make alternatives attractive.
Did you know that hydrogen is cost efficient at 150 a barrel? you can use coal or nuclear to turn water into hydrogen, at an energy loss, but cost is what matters in the end.
Oil will not stay at thsi price but the constraints on growth will… This will mean people will notice another oil shock after it goes down again fairly quickly. This is why alternatives become viable.
The best outcome will be a combination of all the alternatives. And….nuclear power.
Mrs. bugsme…
I think your right about that…it will take a few years before this starts happening though, perhaps two decades…In the transition period, oil nations will have a ball.
in other words..its going to crash and oil nations will not like the outcome (its not their fault or anything that oil has gone up though)…but then perhaps it will go up again a year later, so, its up for grabs.
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6 Responses to “Where do expect oil price per barrel to go from here?”
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I think it wont go to any stable prize, as the needs are growing it is on a run to increase continuously
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There is huge demand destruction ongoing. Arabs screwed up this time - at $4 a gallon people will start making changes. I view the price increase as very healthy for the US and the world (going forward). It accelerates the development of non-hydrocarbon based energy source.
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If Iran follows through with its threat to block the major pathway (port) where the oil comes through in the Middle East, we could be paying $10 a gallon for oil in the not so distant future.
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To go up 30% every year till we stop driving.
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By the beginning of 2009, oil will be $200 a barrel and gasoline will be $6 a gallon.
After that oil will continue to go up by at least $100 a barrel per year, and at least $2 a gallon for gasoline.
The only limiting factor in how high prices will go is that at some point the global economy will collapse from the strain. This in turn will cause a rapid decline in human population levels as predicted in Richard Duncan’s “Olduvai Theory”.
Get ready; it’s going to be a rough ride…..
Nimadan
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I am playing very big on oil trading, from Morgan Stanly, Goldman & Sachs on the Wall Street .
I bought millions and millions of barrels of oil when they cost $60–$100 a barrel. I expect to make a kill when I sell. But right now it’s only $145 a barrel. So here is my difficulty:
I already requested my agents spin the media, like: “Oil future looks high, expecting to be in the range of $200 a barrel soon. ” But it does not work price up as fast as I expected.
I have also demanded my agent playing “China demand high” blaming game.
I am glad to see that Congress is ignoring 19 top trade group’s letter demanding an end to rampant oil speculation
Also I am happy to see that the Media did not report it as I desired.
But how do I corner the oil future price up very fast ? fast enough in time so not to get caught ?