Building a world of
resilient communities.

MAIN LIST

 

Analyst expects oil may rise to US$75

Crude oil prices, which rose to a record US$55 a barrel in New York on Friday, may increase further and peak at US$75 a barrel, said Bernard Dan, president of the Chicago Board of Trade, the second-biggest US futures market.

"Given that some production is going on around the world, I can't see it much higher than US$75 unless there are disruptions in supply lines," Dan said on Nine Network's Business Sunday show in Sydney. "I think that the US economy is strong enough to absorb that."

Crude oil for delivery next month closed on Friday at US$54.93 a barrel on the New York Mercantile Exchange after reaching US$55 during the day, the highest since futures began in 1983.

Futures were boosted by comments from Federal Reserve Chairman Alan Greenspan, who said oil isn't high enough to slow expansion as much as in prior oil shocks. High oil prices helped push the US economy into recession in the 1970s and 1980s, and caused demand to plunge by 19 percent between 1978 and 1983, according to the US Energy Department.

While a rise to US$75 sounded significant, the majority of oil traders and consumers had "priced in that sort of range and while it may do some damage in terms of the economy and may be reflected in our equity market, I don't think it's going to be at a level where it's catastrophic," Dan said.

It's clear though that rising energy prices are creating concern in US equity markets, he said.

What do you think? Leave a comment below.

Sign up for regular Resilience bulletins direct to your email.

Take action!  

Find out more about Community Resilience. See our COMMUNITIES page
Start your own projects. See our RESOURCES page.
Help build resilience. DONATE NOW.

 

This is a community site and the discussion is moderated. The rules in brief: no personal abuse and no climate denial. Complete Guidelines.

Tags:  

Evidence Released at TransCanada’s Keystone XL Permit Renewal Hearing Sheds Light On Serious Pipeline Risks

Just because TransCanada continually states that the Keystone XL pipeline …

Peak Oil Notes - July 30

Much of the news that will eventually move oil prices came on the …

Higher-risk 'Shallow Fracking' More Common than Suspected: Study

The fracking of oil and gas less than a mile from aquifers or the Earth's …

Shale Gas Reality Check

Recently, the EIA released its Annual Energy Outlook 2015 and so we asked …

The Community Energy Revolution

Impact investing is investing to achieve a return in something you also …

Peak Oil Review - July 27

A weekly review including Oil and the Global Economy, The Middle East & …

Energy Crunch - Green taxes: love or hate?

Green taxes have been under attack on all fronts lately.