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Headlines : CorporationsCIBC Economist: $100 Oil by End of '08
CIBC World Markets chief economist, Jeffrey Rubin, said that oil prices could hit $100 a barrel by the end of 2008 and remain at a triple digit price. Rubin also stated that the rising demand from nations such as Mexico, Venezuela, and Saudi Arabia will be the primary cause for increasing oil prices in the future. Furthermore, he predicted that Mexican oil exports to the U.S. will dry up by 2012 and that a third of all U.S. oil imports will come directly from Canadian oil sands.
[Posted By grady]Republished from Associated Press
NEW YORK (AP) — Oil prices could top $100 a barrel by the end of next year and remain above that point for years to come, the chief economist of Canadian investment bank CIBC World Markets said Tuesday.
Jeffrey Rubin said rising demand within oil-rich nations such as Mexico, Venezuela and Saudi Arabia will put pressure on global oil prices in the coming years. That, combined with the increased cost of pulling petroleum from reserves deep under the sea or wringing it out of oil sands in Canada, will keep oil prices high even if demand in the Western world remains constant.
“We’re in a world of triple digit oil prices for the foreseeable future,” Rubin said during a speech to investors here.
Rubin said oil exports from OPEC countries, Russia and Mexico will likely decline by about 3 million barrels per day over the next five years. The biggest drop, he expects, will come from Mexico, a key U.S. supplier.
Posted by grady
hopefully
The Many Inaccuracies of Energy/Oil/Natural Gas Discovery
First off, always be very sceptical of new energy (oil, natural gas) discoveries. If you read closely, you’ll usually find a large amount of speculation and political pressure. Randy Kirk brings a very sobering example here
Fun piece from Business Week
Chavez’s Billion-Dollar Snub of the U.S.
OPEN QUOTE
Venezuela President Chavez is cutting a deal to ship oil to China, which will lessen profits—and dependence on the U.S.
Chinese markets are 30 days away from Venezuela by tanker, compared with five to six days for U.S. Gulf ports. The cost of transporting crude to China will shave several dollars per barrel from Venezuela’s take, analysts say.
“Chavez would clearly have to lower the price of the crude,” says Lucian Pugliaresi, who heads the Washington-based Energy Policy Research Foundation. “He would have to offer a discount of between $5 and $10 a barrel.”
If that’s the case, the cost to Venezuela could hit $5 million to $10 million a day in lost profits, or as much as $3.7 billion a year. Still, that may be a price Chavez is willing to pay since a long-term supply and refining agreement would boost Venezuela’s toehold in the world’s fastest growing energy market. China is now the world’s second-largest oil importer, trailing only the U.S. Any long-term pact would also allow Chavez to lessen his dependence on the U.S. market.
END OF QUOTE
It’s called Sanctions, dollfeet.