Yeah, I think any price spike would be short lived—based more on fear than real oil disruptions. The Iraq’s are currently shipping about 2.6 million barrels @ day. Most of their production is in the south of the country — far from rebel territory.
The Saudis have 1 million plus of spare capacity. I think I’ve seen numbers that show OPEC has a couple million barrels@ day of spare capacity.
They just completed a meeting in Vienna at which they agreed to hold production at something like 30 million barrels@day.
So even serious supply disruptions from Iraq could be made up for.
But the risk of big supply disruptions puts a floor under oil prices. They are not going under $100@barrel any time soon.
And the price range may move from 90-110 to 100-120
Currently prices are at the top of their current range near 110.
Iraq Says Southern Oil Facilities ‘Very, Very Safe’
http://www.rigzone.com/news/oil_gas/a/133505/Iraq_Says_Southern_Oil_Facilities_Very_Very_Safe#sthash.WHmb3Bdb.dpuf
Iraq’s southern oil export facilities, currently its only export outlet, were secure, with shipments now running at around 2.6 million barrels per day, Oil Minister Abdul Kareem Luaibi said on Wednesday...
All our exports now are from the Basra terminal in the south - and it’s a very, very safe area,” Luaibi told reporters ahead of an OPEC meeting. Iraq’s northern export pipeline, which connects to a Turkish terminal, has been out of action since March after a bomb attack...