Oil passes $75 on its way up

Douglas McIntyre

Oct 14th 2009 at 8:30AM

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Oil traded on Globex moved to $75.15 overnight Tuesday. Part of the reason is that OPEC said it expected demand to rise next year -- up by 200,000 barrels a day.

More and more analysts are predicting crude will hit $85 before the end of the year. Their arguments are compelling. Demand is likely to rise as the recession ends in the U.S., Japan, and the E.U., which are the traditional leaders in crude use. But the BRIC nations (Brazil, Russia, India and China) are now driving crude prices as their economies grow and their needs for transportation and infrastructure expansion increases.

The other side of the oil coin is that some of the traditional large producers like Mexico are finding that their fields are aging and that the yield from these fields is decreasing. There is no guarantee that the producing nations can quickly turn open the hose and keep up with demand if it starts to spike later this year.

The fact of the matter is that oil prices could be one of the greatest threats to a sustained economic recovery. The drop of crude prices from $147 last summer to under $40 earlier this year probably kept the economic catastrophe from being even worse than it was. Consumer and business spending will be hit if gas prices start to move back above $3.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Reader Comments (Page 1 of 1)

10-14-2009 @ 9:01AM

dang1067 said...

So what happens if their predictions fails like they always do???? What happens when demand PLUNGE as everyone been witnessing since last year when it hit $140 bbl???? Will they refund all the failed investors??? Just because some monkey say demand will climb next year does that mean they can manipulate and jack oil price now???? FVCKING SCVMS!!!! Demand for Oil will continue to plunge due to dying industries, shut down manufacturers who can't sell their damn products... You want proof??? See retail sales records for this year and you will see how dead they were!!! People are holding their wallets and are not spending!!!! They're not spending cause they have no income!!!! No income because they are out of job!!!! They are out of jobs because the companies, factories or manufacturer they use to work for are shut down bankrupt!!!! And you fvckers are to convince us with you propagandas that demand will increase???? And despite the fact that in 2010 electric vehicles will be more out on the roads??? And more homes will be solarized built with green power source technologies???? So FVCK YOU, you scvm corrupt parasites!!!!

10-14-2009 @ 9:09AM

dang1067 said...

I just checked oil isn't at $75, it's $72.75 on the Dated Brent Spot 10-14-2009 08:53 am!!!

10-14-2009 @ 3:56PM

Jo said...

Our government has always thrown money all over the world to benefit our backstabbing enemies & to enable & reward people who have children out of wedlock.
When will the day come that taxpayer money is poured into finding new & environmental friendly sources of power?
Lobbyists should be outlawed.

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