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Gas jumps above $3.67, oil passes $126 on Venezuela concerns
John Wilen, Associated Press via Yahoo!Finance
Oil rose above $126 a barrel for the first time Friday, bringing its advance this week to nearly $10, as investors questioned whether a possible confrontation between the U.S. and Venezuela could cut exports from the OPEC member. Gas prices, meanwhile, rose above an average $3.67 a gallon at the pump, following oil’s recent path higher.
On Friday, The Wall Street Journal published a report that suggested closer ties between Venezuelan President Hugo Chavez and rebels attempting to overthrow Colombia’s government. Chavez has been linked to Colombian rebels previously, but the paper reported it had reviewed computer files indicating concrete offers by Venezuela’s leader to arm guerillas. That appears to heighten the chances that the U.S. could impose sanctions on one of its biggest oil suppliers.
“If we put on sanctions, I’m sure Chavez would threaten to cut off our oil supply,” said Phil Flynn, an analyst at Alaron Trading Corp. “Obviously that would have a major impact on oil prices.”
(9 May 2008)
Oil execs see $100-or-less cost by year’s end
Associated Press via MSNBC
Even as oil prices ascended to new highs of more than $124 a barrel this week, many oil and gas industry executives say they expect the price to fall significantly by year’s end, a new survey shows.
Fifty-five percent of 372 petroleum industry executives surveyed by KPMG LLP said they think the price of a barrel of crude will drop below $100 by the end of the year. Twenty-one percent of respondents predicted a barrel of oil will end the year between $101 and $110, while 15 percent forecast the year-end price to be between $111 and $120 a barrel.
(8 May 2008)
The Case For $80 A Barrel Oil
Daniel Fisher, Forbes
Oil prices may hang above $100 a barrel for the rest of this year but will fall as low as $80 next year as world demand slackens and Saudi Arabia tries to buy influence with the incoming president by pumping more crude oil, an influential Lehman Brothers analyst said in a report issued today.
Saudi engineers have been working on several big projects that could boost the nation’s output by 1.3 million barrels a day–more than the expected increase in global demand next year–but the secretive nation is “likely to keep its political tool, excess production capacity, close to its chest until it has a new U.S. president to win over,” Edward Morse writes.
(9 May 2008)
World begins to smart from oil’s too rapid rise
Barbara Lewis and Peg Mackey, Reuters via Forbes
From the poorest of Africa to the United States and big business, a breakneck rally that could take oil to $200 a barrel is likely to inflict pain on everyone.
The world was remarkably resilient to a series of record prices in 2007, but a roughly 30 percent rise since the end of last year, with predictions of more to come, is harder to absorb.
“The key issue is the rate of change. The recent exponential rise is unhealthy for everyone,” a senior executive from a major oil company said. He declined to be named.
(9 May 2008)
