debt agreement?, page-8

Another one ...

Cover story from Barron's (you'll need a subscription), but here are excerpts - its a long article.


Barron's Cover: SATURDAY, MARCH 29, 2014
Here Comes $75 Oil, By GENE EPSTEIN

"The long-term outlook for global oil prices is lower, perhaps much lower, giving a strong boost to the U.S. economy while potentially crippling the economy of Vladimir Putin's Russia. Vast new discoveries of oil and natural gas in the U.S. and around the globe could drive the oil price to as low as $75 a barrel over the next five years from a current $100."

"The demand side, too, will put pressure on the supremacy of petroleum. For the first time in its 150-year history, the internal combustion engine can be run efficiently on alternative fuels from a number of sources, including natural gas. As these alternatives are increasingly introduced, global consumption of oil will slow its growth and flatten out. "

"Citigroup's head of global commodity research, Edward Morse, believes the combination of flattening consumption and rising production should mean that "the $90-a-barrel floor on the world oil price over the past few years will become a $90 ceiling." Within a new trading range with a $90 ceiling, Morse sees an average of $75 as plausible."


Now I've posted the recent article from EIA re short term (to 2015) and this from Barron's looking long term. Neither has the view of a rising oil price.

My point in posting is that oil is a commodity that is not necessarily in short supply and thus the price can be very elastic. It can just as easily go down as up. Lots of info - I'm watchful of the source of everything what I read.