Wow. $200 a barrel. When I worked at Hess, Qatar crude as $13; after the Iranian revolution, spot market crude went to $40.
Arjun N. Murti remembers the pain of the oil shocks of the 1970s. But he is bracing for something far worse now: He foresees a “super spike” — a price surge that will soon drive crude oil to $200 a barrel. Mr. Murti, who has a bit of a green streak, is not bothered much by the prospect of even higher oil prices, figuring it might finally prompt America to become more energy efficient.
Maybe I should get a more fuel-efficient car; $4 a gallon gasoline might go to six bucks a pop.
An analyst at Goldman Sachs, Mr. Murti has become the talk of the oil market by issuing one sensational forecast after another. A few years ago, rivals scoffed when he predicted oil would breach $100 a barrel. Few are laughing now. Oil shattered yet another record on Tuesday, touching $129.60 on the New York Mercantile Exchange. Gas at $4 a gallon is arriving just in time for those long summer drives.
As of 1.30pm crude went through $132. Ole Boone Pickens weighed in yesterday with a $150 a barrel forecast.
T. Boone Pickens' $150-a-barrel oil forecast looks more prescient by the minute, while the Bank of England cites fundamentals as the key.
Three months ago the sages said the fundamentals did not justify 80, 90, or 100 dollars a barrel.
That dude on the line has his gasoline-powered lawnmower!
Mr. Murti, 39, argues that the world’s seemingly unquenchable thirst for oil means prices will keep rising from here and stay above $100 into 2011. Others disagree, arguing that prices could abruptly tumble if speculators in the market rush for the exits. But the grim calculus of Mr. Murti’s prediction, issued in March and reconfirmed two weeks ago, is enough to give anyone pause: in an America of $200 oil, gasoline could cost more than $6 a gallon.
6 bucks a gallon; to fill my 14 gallon tank would cost me 84 bucks.
That would be fine with Mr. Murti, who owns not one but two hybrid cars. “I’m actually fairly anti-oil,” says Mr. Murti, who grew up in New Jersey. “One of the biggest challenges our country faces is our addiction to oil.”
Experts disagree over the supply of oil, the demand for it and whether recent speculation in the commodities markets has artificially raised prices. As an energy analyst at Citigroup, Tim Evans, reportedly put it, trading commodities these days is like “sticking your hand in a blender.”