The staggering, seemingly never-ending drop in the price of oil is still generally referred to as a plunge (as in oil prices plunged again), but it looks ever more like a collapse -- even if to levels that were commonplace before 2004. Some experts are now saying, reports the Washington Post, that the $100 barrel of oil will never return. Of course, who knows. But heres an interesting Post piece on whats behind it (including the Saudis, who continue to pump as if there were no tomorrow to sink competitors -- and not just political ones either). Its a remarkable and utterly unexpected change that, if it goes on, could turn our world upside down in all sorts of unpredictable ways, good and distinctly bad as well. Tom How low could oil prices go? It’s anybody’s guess. The price of oil fell to its lowest level in five and a half years Monday, with both Goldman Sachs and Societe Generale lowering their projections. Oil price forecasting is a hazardous business. In June 2014, Barclays was forecasting a $109 a barrel price in the fourth quarter, nearly $50 a barrel more than what prices actually averaged in the fourth quarter. On Monday, the price of the international benchmark crude, Brent, fell to below $48 a barrel in London. Gasoline prices fell below $2 a gallon in the Midwest and gulf coast last week. In an interview with the respected industry newsletter Argus Global Markets published last Friday, Saudi Arabia’s oil minister Ali al-Naimi was asked whether the world would ever see $100 a barrel oil again and he said: We may not.” washingtonpost/blogs/wonkblog/wp/2015/01/12/how-low-can-oil-prices-go-welcome-to-the-oil-markets-old-normal/?hpid=z4
Posted on: Mon, 12 Jan 2015 18:40:40 +0000
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