Oil to reach $250 a barrel?

Andrew

and therefore Scottish independence

cjcjc

It's often this kind of "forecast" - mysteriously not made when oil was lower - which marks a top!

TrevorH

why stop there - does he actually have a clue?

Ian C

Agreed cjcjc. As soon as it is obvious that inflation is the main dragon to slay - i.e after the US election and possibly before - interest rates rising on dollar deposits will bring the speculation to qan end and the price will over react down too low. A best guess it that it will settle in the $70-100 region, long term. We can live with that. Current levels are bringing the world to a halt. You only have to drive on a motorway to know.

thomas

Does Gazprom have oil as well as gas? If so, I'm not sure this is a prediction in the way we normally understand it.

Herbert Thornton

I think Ian C is right. Earlier this year, a prominent Saudi (whose name I've forgotten) was discussing the potential of the Canadian Tar Sands (as much oil in them as in Saudi Arabia, and maybe even more). He noted that the Tar Sands (which are already being exploited on a huge scale) could turn a decent profit with oil in the price region that Ian mentions - and he forecast that this would force the price of all other oil to come down to that range too.

Another very interesting comment was a short piece in various newspapers by Charles Krauthammer He advocates an import tax on oil to ensure that the petrol price at the pump is high enough to simultaneously discourage the use of oil and encourage the development and use of other sources of energy. He also argues that such a tax would very much reduce the amount of money now flowing into the Middle East, while increasing U.S. government revenue very substantially. It makes sense to me, but the likelihood of it happening seems remote.

Nonetheless, the more oil costs for whatever reason, the more certain it is that manufacturers will respond by offering products such as cars that will not use petrol. General Motors for example are reported to be preparing to sell a largely electric-powered car in 2010 - one that appears to be even less reliant on petrol than Toyota's current Prius.