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Crude oil at $100 a barrel will be soon a reality
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Kenneth
Feb 23 2008
Nyc,
United States
We are just waiting for the good news - crude oil at 100-a-barrel. It sounds horrible.
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crude oil will go above $100, that you can take to the bank. There is a fundamental supply-demand issue which cannot be resolved no matter how much oil is in the ground as we cannot pump it out fast enough even if we did have plentiful oil. If we did have world refinery capacity could not refine raw crude into its products fast enough anyway , the main one being liquids i.e. petrol and diesel.
Some people argue that a USA/global slowdown would halt the demand for oil. yesy it would but it will not forstall the inevitable as supply shrinks. Peak production occured in may 05. ever since then out put has fallen despite increasing demand. The buffer between daily demand and supply is continually shrinking and is currently approx 1 million BPD.
If you think $100 is due to commodity speculation, and you may well be right SHORT TERM then you are fooling yourself.
the demand from ever incraesingly richer asians who are manufacturing their own cheap cars not importing expensive ones will send crude very much higher. The USA will feel it most. 70% of their fuel requirments come from abroad and from increasingly hostile countries e.g. venezuela and russia
they have zero policy contingency to copy with this. COMING SOON (2009) -expect fuel queues at a gas station near you.
Some people argue that a USA/global slowdown would halt the demand for oil. yesy it would but it will not forstall the inevitable as supply shrinks. Peak production occured in may 05. ever since then out put has fallen despite increasing demand. The buffer between daily demand and supply is continually shrinking and is currently approx 1 million BPD.
If you think $100 is due to commodity speculation, and you may well be right SHORT TERM then you are fooling yourself.
the demand from ever incraesingly richer asians who are manufacturing their own cheap cars not importing expensive ones will send crude very much higher. The USA will feel it most. 70% of their fuel requirments come from abroad and from increasingly hostile countries e.g. venezuela and russia
they have zero policy contingency to copy with this. COMING SOON (2009) -expect fuel queues at a gas station near you.
oh yes. OPEC probably are trying to keep prices high.
a. why sell crude at $80pb when you can sell much less at $100 per barrel and thus increase the lifespan of your reserves
b. they want to sell less as they are running out. Some like Matt Simmons doubt that they have much room to increase production EVEN IF THEY WANTED TO. i.e. they are close to maxxed out already
a. why sell crude at $80pb when you can sell much less at $100 per barrel and thus increase the lifespan of your reserves
b. they want to sell less as they are running out. Some like Matt Simmons doubt that they have much room to increase production EVEN IF THEY WANTED TO. i.e. they are close to maxxed out already
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