Inflation is kickin in
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It went artificially high, b/c of our inflation before the rest of the worlds major currencies started to loose values. Then, the pendulum shifted, and it dropped artificially low (and if you think <38/barrel is normal, you again prove your misunderstanding of economics.)
Many forecasts that I review estimate that by mid year apr-june, oil will stableize between 70-90/barrel, and we'll see gas back in the mid $3 range. The recent spike is a combination of OPEC's recent cut in production as well as global concern regarding the security situation in the Mid-East, (and that's just for sweet crude, not to mention Russia's vindictive natural gas saga with cutting of Ukraine)
Many forecasts that I review estimate that by mid year apr-june, oil will stableize between 70-90/barrel, and we'll see gas back in the mid $3 range. The recent spike is a combination of OPEC's recent cut in production as well as global concern regarding the security situation in the Mid-East, (and that's just for sweet crude, not to mention Russia's vindictive natural gas saga with cutting of Ukraine)
The US government as also been adding to their reserves which indicates they are preparing for decreases in supply/increases in prices.
Much of the recent increase in prices can be attributed to investors belief that the market over swung the low and that as Jomodo said, prices will likely stabilize at 60+ or more.
I don't know if you any of you are making any oil plays, but when it dips back down again I suggest you look into DXO.
I bought in at about 2.11 and so far so good, and I anticipate better returns in the immediate, and if not, longer term future.
The big picture is higher oil prices are good because they generate a lot more interest in alternative energies.
The fuck are you talking about? I dont even own a car, dick. The fuck do i care about muthafuckin gas prices?
Somebody needs to refrain from making assumptions about people of whom which they obviously know nothing about.
By the way, every human being on earth has intrinsic views and values, whether you want to admit it or not. So, once AGAIN, you can miss me with the high and mighty bullshit.
Somebody needs to refrain from making assumptions about people of whom which they obviously know nothing about.
By the way, every human being on earth has intrinsic views and values, whether you want to admit it or not. So, once AGAIN, you can miss me with the high and mighty bullshit.
I agree price will not stabilize, and that generally speaking, it is on an upward trend. However due to a large number of influences on price, while moving upward it will periodically find valleys.
Oil will probably stabilize somewhere in the 60-80 range, and then depending on the particular influences acting on it at the time, either shoot higher or come back down. Most governments have an interest to keep oil from shooting off the charts, so they will do everything they can to keep it below a certain point, whether that means subsidies, increased drilling/production, limits on consumption, etc; regardless of the shortsightedness of their actions.
Reality check:
These are the projections for oil production in the next 40 years based on Hubert Peak Oil theory:
today: 27 billion barrels a year
2020 - 20 billion barrels a year
2030 - 13 billion barrels a year
2040 - 9 billion barrels a year
2050 - 5 billion barrels a year
How elastic do you think the demand for oil is? It is a very good moment to ask this question given what is happening right as we speak in Europe where countries are declaring nationwide emergency just after one day of disrupted gas deliveries.
So, given that supplies will be steadily decreasing, at what point do we hit the inelastic demand level, below which we can't go and at which point prices will really sky-rocket?
Nobody know for sure, but it is highly unlikely that is is below 20 billion barrels a year now, much less that it will be below 20 billion barrels a year in 2020 when we have another 2 billion mouths to feed
P.S. Also, we should not forget that the price is not determined by supply and demand only, the perceptions of the market have an enormous influence. Right now most people still haven't waken up to the reality of Peak Oil, the real disaster will come when this happens
These are the projections for oil production in the next 40 years based on Hubert Peak Oil theory:
today: 27 billion barrels a year
2020 - 20 billion barrels a year
2030 - 13 billion barrels a year
2040 - 9 billion barrels a year
2050 - 5 billion barrels a year
How elastic do you think the demand for oil is? It is a very good moment to ask this question given what is happening right as we speak in Europe where countries are declaring nationwide emergency just after one day of disrupted gas deliveries.
So, given that supplies will be steadily decreasing, at what point do we hit the inelastic demand level, below which we can't go and at which point prices will really sky-rocket?
Nobody know for sure, but it is highly unlikely that is is below 20 billion barrels a year now, much less that it will be below 20 billion barrels a year in 2020 when we have another 2 billion mouths to feed
P.S. Also, we should not forget that the price is not determined by supply and demand only, the perceptions of the market have an enormous influence. Right now most people still haven't waken up to the reality of Peak Oil, the real disaster will come when this happens
