Oil heading to $200

[jake75]

That's one prediction. The price of commodities, and oil is a commodity, can sky rocket on a very minor shortgage. The last 1 or 2% probably sets the price for the other 98-99%. In a free market these things have a way of being somewhat self correcting. But where the majority of the supply is controlled by a cartel, they can artificially restrict the supply to maximize their profits. And with oil, it is maximizing over the long term - not just the short term.Don't blame the Arabs - they are just acting in their best interests - like all good capitalists. Actually, they are probably being kind. If they reduced their production by 10% oil might be much higher than $200.

[kunkstyle]

Quote, originally posted by jake75 »That's one prediction.Yep. And others have pegged it to be down to $60 by Q3 of 09.

[jake75]

Quote, originally posted by kunkstyle »Yep. And others have pegged it to be down to $60 by Q3 of 09.Be careful what you wish for - the well will just run dry sooner at $60. Maybe someone should run a poll.

[kunkstyle]

Never said it's a good thing. Extreme prices on either end of the spectrum do no good for anybody. Just that there's both sides of the argument among analysists. As far as the well running dry, it'll run out when it runs out. I don't think oil prices will dictate that timing much. For every thousand people buying fuel efficient cars and turning the heat off at night there's a refinery in some third world country flaring off thousands of cubes of useable oil instead of running it back into the refining process, or a country generating it's power with diesel instead of coal or another source.

[scott_h]

I'll have to find the article - but someone else said it could just as easily drop to $40, and that the particular company proclaiming $200 has predicted these huge increases in the past and been wrong.In the spring of 2007, AAA predicted $4.00 gas by Labor Day (or was it Memorial Day?) - I think I only paid over $3.00/gallon a handful of times in 2007. Their prediction was not even close.It's nothing but speculation, and there are those out there that throw darts and completely miss the dart board. But at least they got their name in the news for predicting that they'd get a bullseye.I can't say it won't happen - but I also can't say it will.

[zionzr2]

One factor in the cost is how weak the US Dollar has been! This also causes the the prices to increae that that trade in US Dollars on a world market.The US Government needs to stop bickering about taxes this and intrest rates that. They need to figure out how to get the strength of the US Dollar back.