OPEC minister predicts $75 oil
Filed under: Economy
Will oil keep going higher? The oil minister of Saudi Arabia thinks so, even though OPEC does not appear ready to change its production targets in the near future.
According to Bloomberg, Saudi Arabian oil minister Ali al-Naimi believes that demand and not supply is what will drive oil higher, but he notes, "The problem is the market, that the demand is only in one place -- Asia and that's all."
Many leading economists see the U.S. and other large countries emerging from a recession as early as the end of the year. If that happens, OPEC does not need to do anything of significance for the price of crude to rise.
OPEC must have one important concern. If oil rises sharply before the end of the recession, prices of crude and its by-products, including gasoline, could spike up and undermine business and consumer spending. That could push the economy into the second phase of what would be a "double dip" recession. Under those circumstances, the demand for crude would likely fall and oil would head down from $60 where it trades now.
It's a tricky balancing act.
Douglas A. McIntyre is an editor at 24/7 Wall St.
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Reader Comments (Page 1 of 6)
5-24-2009 @ 1:47PM
mrohiofats said...
What joke the oil companies are. We get robbed everytime we buy gas. I bet they boast a very good profit this year.
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5-26-2009 @ 11:51AM
gunwriter said...
It's not a balancing act. It's a game. Anyway, how can the recession end when the US is losing its AAA rating and printing more money to pay for its debt--simply not possible.
5-24-2009 @ 2:07PM
Paulio said...
This is a double joke. The first that the report says that the recession will end by the end of this year and that Asian demand is causing the price of oil to rise. I think I'm gonna fugure out how to make my own gas or perhaps some other method of generating the fuel that I need. I'm sick of this!
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5-25-2009 @ 10:18PM
Gil said...
Thats easy, Vote for Ron Paul next time.
5-24-2009 @ 4:41PM
terry70 said...
If the speculators keep it up Obama will nationalize the oil companies with the support of the working people,,I almost think that the plan...
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5-24-2009 @ 5:29PM
Dan said...
The dollar collapsing and the credit worthiness of the United States is driving speculators to put their money in commodities that will appreciate. Until we get our finacial house in order we will get more of the same. We cannot spend money we do not have! Come on America, we can do better.
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5-24-2009 @ 7:20PM
SUNNY said...
NOT SURE IF THIS WENT THROUGH THE LAST TIME???SOOO IF YOU PUMP MORE THAN 20 DOLLARS THE STATION/GAS COMPANY THINKS YOU HAVE RECOVERED ALL OF YOUR MONIES. ALSO WATCH YOUR BANK STATEMENT IF YOU CHARGE/DEBIT YOUR GAS THEY RUN IT TO SEE IF IT GOES THROUGH FOR 1 DOLLAR AND THEN FOR THE AMOUNT YOU PUMP BUT THE DOLLAR NEVER COMES OFF. I HAVE TAKEN MY BANK STATEMENT IN TO SHOW THE CASHIER IT HAPPENED THREE TIMES BEFORE I CAUGHT IT. THEY REFUNDED THE MONEY BUT HOW MANY GOT AWAY WITH THIS SCAM?
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5-26-2009 @ 11:54AM
Gunwriter said...
Sunny. That really has to make one think: What the hell is going on?
5-24-2009 @ 7:35PM
Mike said...
Okay America. How many more kicks to the teeth do you need from OPEC before this government comes up with Manhattan Project type research and development for reliable and affordable "plug in" technology? How many more TRILLIONS a year have to leave this country before YOUR elected leaders "get it". It's as simple as batteries and electric motors in a car---that's it. Get on the freaking phone to MIT and some of the other top engineering schools and give them whatever they need. Get this through your thick sculls, America. Your elected leaders could care less about you. There's not a one with any testicular fortitude that will stand up before the people and say, "STOP". Big business comes first, the masses come LAST---every time.
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5-24-2009 @ 8:02PM
Manny said...
Keep trusting the arabs to run the world they control the oil control our government and soon the will be making our laws ex.our president vowing down to an arab king ain't our president the most powerful man in the world? ex. we put our soldiers in trial for doing their jobs them savages don't have any combat rules why should we.
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5-24-2009 @ 8:03PM
pasinby1 said...
I wouldn't worry as much about OPEC , as obama and his cap and trade bill ! This bill bill is very important to his lofty ambitions , and yes it dose affect all of us , not just industry!
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5-24-2009 @ 8:40PM
dgf said...
What kind of manipulation is this article seeking ? The US currently consumes 300 times more oil than China. I really wish that someone could let us all know what is really going on instead of all theses smoke and mirror screens put out by the media in this country. The govt's worst enemy is our own media especially the likes of AOL with their blatant manipulations of the general populace.
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5-25-2009 @ 1:57PM
Scott said...
The US consumes a bit less than 3 times as China (20.7 mil bbl/day as compared to 7.6 mil bbl/day). Of course the rusage/capita is higher in US.
Maybe you meant to say we consume 300% more than China which would be correct. But maybe you would have had to pay attention in math class. Maybe that's why the rest of the world is eating our lunch?
5-24-2009 @ 9:30PM
J said...
Chang the maximum payout for weekly enemployment dollars for NY to match that of Massachussetts NOW!
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5-24-2009 @ 9:27PM
jeb said...
Well its vacation time again like every year ripoff
where is our oil from alaska huh
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5-24-2009 @ 9:46PM
Chuck said...
The SEC needs to investigate the Hedge Funds that keep running up the price of oil. These same Funds also run up the stock price of the oil companies. That's insider trades if they run up one to cause the price of the other to go up too?
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5-24-2009 @ 10:22PM
Jk said...
We are screwed because we have a President who is a Damn Tree Hugging Liberal who doesnt care about America. If we would drill here oil would not go up.. California could solve most of its financial problems if they would drill. Oil started going down when then Pres Bush opened drilling on federal land. That showed the Crooks at OPEC they couldnt minipulate the market as much when we were buying less or no oil from them. We need to drill here and drill now period. Do the alternative energies but drill more til the other stuff is ready which is in some cases 20 yrs down the line
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5-25-2009 @ 8:26PM
Mike McKibben said...
Jk, it is because the oil companies are doing "all this exploration" for oil.....you know your "drill here, drill now" philosophy, that "gas" prices are going up. Regardless, we have to break the cycle of dependency on oil. The sooner the better.
5-25-2009 @ 9:52PM
Joe said...
You are so dumb. Obama is screwing up as well but we had OUTRAGEOUS gas prices while YOUR hero was in office. He's the idiot who put this country in the mess it's in and he's the one reaping the rewards on the ridiculous oil/gas prices. How much stock in oil do you think he owns? Know what you're talking about before you open your ignorant mouth. Not every bad thing in the world is caused by a democrat. Republicans screw us all!!
5-24-2009 @ 10:30PM
Willie said...
We need to give incentives to the U S Farmers to grow corn all across the United States. This will make Etahanol 85 cheaper. We can order the newer cars with the flex fuel option so they can be run on Ethanol 85. They run cleaner.
Electric Power Producing Plants can be run on Natural Gas It burns clean. Coal is polluting our earth. The oil companies need to produce clean burning fuels. Liquid Petroleum Gas burns cleaner than gasoline. Detroit needs to get with the program and build clean running cars. The Japanese have beat Detroit at building efficient quality clean running cars.
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