New 'super-spike' might mean $200 a barrel oil(so says Goldman Sachs)

Market Watch ^ | 03/07/08 | Steve Gelsi

[TigerLikesRooster]

New 'super-spike' might mean $200 a barrel oil

Goldman's projections foretell persistent turbulence in energy prices

By Steve Gelsi, MarketWatch

Last update: 1:42 p.m. EST March 7, 2008

NEW YORK (MarketWatch) -- With $100-a-barrel here for now, Goldman Sachs says $200 a barrel could be a reality in the not-too-distant future in the case of a "major disruption." Goldman on Friday also boosted by $10 the low end of its 2008-2012 projected range for crude to $60 a barrel -- significantly lower than current prices, to be sure, but a possible mark for oil if "normalized" trends return to the marketplace.

With the dollar's fall continuing and financial markets roiled by the credit crunch, commodities like oil have been drawing the fancy of increasing numbers of investors. Accordingly, Wall Street firms have been eager to adjust forecasts to incorporate fresh data on the global economy and energy supplies.

Goldman analysts Arjun Murti, Kevin Koh and Michele della Vigna said prices have advanced more quickly than Goldman had forecast back in 2005, when it predicted a range of $50 to $105 a barrel as part of its "super-spike" oil theory.

"We characterized the upper end of the band as more likely to be driven by geopolitical turmoil and that recession was a key risk to our view," the analysts said. "In fact, oil prices have reached $100 a barrel without extraordinary turmoil, and the U.S. currently appears to be in recession."

[JavaJumpy]

Interesting - they’re a big Obama contributor.

http://opensecrets.org/pres08/contrib.asp?id=N00009638&cycle=2008

[Young Scholar]

Does the FTC even regulate financial instruments? I can’t imagine they have the power to actually ban futures, and even if they did it would never stop them from being traded—all trading would just move overseas.

[calex59]

I would suspect that we will see unified military action taken long before oil even gets close to $200 a barrel. I wouldn’t be surprised to see the navies sailing and the bombers flying at $130.

How about we just get pissed off enough to tell the greenies enough is enough and drill for our own oil and take advantage of nuke power and also do what we can with oil shale. Seems like a better alternative than fighting some other country for what we already have right here if we would just hunt for it and ultilize it, instead of letting eviros call the every turn..

[TigerLikesRooster]

Will take several years or a decade to start production even if we start to act now.

[mkjessup]

Right, the whole world lives for the good of the USA. And if we can't we should start killing people who don't give us what we are not willing to pay for. That is immoral, and I would say that makes you immoral. If we do that, the whole world will line up against us.

[OpusatFR]

” I am sure that Goldman Sachs has already positioned itself to benefit from super-hike.”

I’m sure GS will be on both sides of the play.

[mkjessup]

OPEC’ will stand for ‘Occupied Petroleum Exporting Colonies’.
Now THAT has a nice ring to it. A REALLY nice ring.

Can't do it. Somebody in this thread is already whining about it being *IMMORAL* so we can't even discuss it, let alone think about it.

We now return you to your regularly scheduled kumbaya program.

[mkjessup]

How about we just get pissed off enough to tell the greenies enough is enough and drill for our own oil and take advantage of nuke power and also do what we can with oil shale. Seems like a better alternative than fighting some other country for what we already have right here if we would just hunt for it and utilize it, instead of letting enviros call the every turn.

That's not a bad concept although there are definite strategic advantages to using up Middle Eastern oil reserves before turning to our own. In addition, seizing those reserves means that the Islamofascists are denied the benefits of all that petro-revenue.

Contrary to what one poster suggested, this isn't really about 'stealing' anything, it is about positive, preemptive action in taking control of a strategic asset that needs to be in U.S. hands, as opposed to potential enemy hands. Nobody is suggesting that appropriate compensation would not be made to the *people* of those regions who would rightly expect a fair (not a wildly inflated) price for their oil. If (hypothetically) we were talking about vast underground reserves of weapons grade plutonium, we would have already seized that material decades ago rather than allow potential enemies to acquire it.

Vastly inflated prices for oil provide enhanced funding for terrorism. There is no difference, the principle is the same.

[mkjessup]

So we should steal what we can’t buy?
It was ours to begin with. Who do you think explored, drilled and produced oil out of the Middle East? It certainly wasn't those Muslim simpletons. If not for our efforts 80 years ago, those camel-jocks would still be wandering the sands. We should take it back.

Ohhhh but that would be *IMMORAL* and the rest of the world wouldn't like us anymore!

/sarc off

[Travis McGee]

Sudden 200 dollar oil coming from, say, the closure of the Hormuz Straits to tanker traffic, would not help GS or anyone else. It would blow up world markets.

[Travis McGee]

I have no doubt we have the military power to seize the oil fields and terminals.

That is a far cry from keeping the oil flowing without disruptions that would cripple the global economy.

[mkjessup]

I have more confidence in our ability to avoid and/or make any disruptions as brief as possible. The Straits of Hormuz might indeed be blocked by the Iranians, but Tehran could also join Hiroshima and Nagasaki in the history books.

[Travis McGee]

How would nuking Iranian cities open the straits?

[mkjessup]

It wouldn’t. But you make an example of them and you demonstrate to others that a price *will* be paid for such shenanigans.

They want to go meet ‘allah’, we should expedite the process for ALL the damn jihadists.

What do they need all that oil for when they go to meet their 72 virgins? ;)

I can think of better uses up here.

[calex59]

Will take several years or a decade to start production even if we start to act now.

That same decade will pass whether we act or not, if we act that decade will see us less dependent on muslim oil, and less money for terrorists, if we don't act that decade will see us in the same place we are now, dependent on muslim oil and paying through the nose for fuel and, worse, we will be faced with newer, more radical enviro laws. The real danger to this country is the radical attitude the greenies have toward any energy use at all. If they have their way the world will be soon plunged into deep depression and poverty, including this country. That is their aim in the long run, make us all poor and dependent on the government. We have better wake up and get cracking.

[calex59]

Contrary to what one poster suggested, this isn't really about 'stealing' anything, it is about positive, preemptive action in taking control of a strategic asset that needs to be in U.S. hands, as opposed to potential enemy hands.

It is always easy to justify taking something that doesn't belong to you and calling it a moral act. Hitler did this in Germany, Japan did it in china and the pacific, and other dictators in the past have used this same strategy. The truth is, the oil is in muslim ground, it doesn't matter who found it in the first place, it is theirs by right of ownership, if you believe in property, and you should if you are a conservative, then you must know it is their oil to do with as they will.

We have no moral or absolute right to their oil, except if we pay for it, IF they wish to sell it to us. Forcing them to sell and saying that they will be compensated is stealing, just as imminent domain is stealing. Solving our energy crisis is easy, if we have to guts to vote conservative and force the government to change the idiotic enviro laws we have been saddled with in regards to nukes, drilling for oil and other energy wasting laws. Stealing from the muslims is not a solution, and such an act would make us just what the liberals have been calling us for years.

[mkjessup]

Let’s cut to the bottom line here:

We can eliminate each and every one of those technicalities that you believe stand in the way, by declaring war on each and every Islamic nation in the region, as their religion is the basis upon which jihad was declared upon the United States, we demand their unconditional surrender, they refuse, we beat their asses like red headed stepchildren, and then their oil becomes our property as ‘spoils of war’.

End of problem.

[kindred]

Yes indeed, the American socialist party has a whole new world order planned and will eventually destroy us all.

[kindred]

There is more oil in America than we could ever use but people are brainwashed by the socialist fools who could not care less and push such scams as resouce conservation,global warming taxation, etc. that the marxist mind beleives and fears. But the wise know better.

[tlj18]

Most people probably don't know this, but it has been official U.S. policy that securing dependable sources of energy (read: oil) is necessary to protect our national security. Personally, I believe in the Peak Oil theory, and that within a few years (less than five) there will not be enough petroleum for everyone. There will be a war between us and China, and the winner will be who doesn't run out of oil first. You cannot wage large-scale war without huge amounts of oil.