BankAngle50
2nd Apr 2005, 02:57
Leading investment firm Goldman Sachs predict USD$105/barrel :ouch: I wonder how low yeild carriers such as Pacifc Blue will survive this? Jet* i guess isn't there to make money but keep VB in line, hence there OK. Can low cost survive this by selling no yeild tickets?
Here a transcript from the US TV show Nightly Business Report. www.nbr.com
03/31/05: Brace For Oil Prices To Reach Crude New Highs
SUSIE GHARIB: $105 a barrel. That`s what oil could eventually cost, according to a report issued today by Goldman Sachs. The news sent crude prices soaring. In New York trading, May crude futures jumped a $1.41 or more than 2.5 percent to $55.40 a barrel. Erika Miller has more on whether oil prices could really gush into the triple digits.
ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: Motorists have been hit hard by surging energy prices. Gasoline has zoomed to record levels, averaging $2.15 a gallon nationwide this week. And if Goldman Sachs is correct, prices at the pump could nearly double to $4 a gallon. The firm says we`re in the early stages of a bull run that could send spot oil to $105 a barrel. Previously, the top end of its forecast range was $80. Goldman says it is concerned that global demand shows no sign of slowing, despite rising energy prices. At the same time, refining capacity is tight, especially for gasoline.
MIKE ROTHMAN, ENERGY ANALYST, ISI: If you look at the U.S. refining situation as a specific market, we are short gas production capacity. We`ve become a larger net importer since the standards changed in the year 2000. And frankly, Congress doesn`t look like they`re prepared to change the clean air act or relax certain standards.
MILLER: Goldman likens the current environment to the 1970s when sky high oil prices helped ignite a worldwide recession. But some analysts point to key differences between then and now.
ROTHMAN: The `70s saw a series of supply shocks. Think about the embargo in `73, Iran`s shutdown of production in `78, even the start of the Iran- Iraq war in `80. The tanker war in `84, but that`s obviously the 80s. These were all supply-side events and they created questions about availability.
MILLER: Rothman says it is premature to predict crude prices could hit triple digits. But most experts agree the upside for oil depends on how quickly demand starts to slow.
IRA ECKSTEIN, OIL TRADER, AREA INTERNATIONAL: You don`t want to say it, but if the economy slows down, there`s going to be less demand for crude oil. That`s really the only thing that`s going to stop the market is if the economy slows down.
MILLER: If crude surges to $100 a barrel, experts agree it would be disastrous for the economy, decimating nearly every sector from retailers to airlines and possibly kicking off a global recession. Erika Miller, NIGHTLY BUSINESS REPORT, New York.
Here a transcript from the US TV show Nightly Business Report. www.nbr.com
03/31/05: Brace For Oil Prices To Reach Crude New Highs
SUSIE GHARIB: $105 a barrel. That`s what oil could eventually cost, according to a report issued today by Goldman Sachs. The news sent crude prices soaring. In New York trading, May crude futures jumped a $1.41 or more than 2.5 percent to $55.40 a barrel. Erika Miller has more on whether oil prices could really gush into the triple digits.
ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: Motorists have been hit hard by surging energy prices. Gasoline has zoomed to record levels, averaging $2.15 a gallon nationwide this week. And if Goldman Sachs is correct, prices at the pump could nearly double to $4 a gallon. The firm says we`re in the early stages of a bull run that could send spot oil to $105 a barrel. Previously, the top end of its forecast range was $80. Goldman says it is concerned that global demand shows no sign of slowing, despite rising energy prices. At the same time, refining capacity is tight, especially for gasoline.
MIKE ROTHMAN, ENERGY ANALYST, ISI: If you look at the U.S. refining situation as a specific market, we are short gas production capacity. We`ve become a larger net importer since the standards changed in the year 2000. And frankly, Congress doesn`t look like they`re prepared to change the clean air act or relax certain standards.
MILLER: Goldman likens the current environment to the 1970s when sky high oil prices helped ignite a worldwide recession. But some analysts point to key differences between then and now.
ROTHMAN: The `70s saw a series of supply shocks. Think about the embargo in `73, Iran`s shutdown of production in `78, even the start of the Iran- Iraq war in `80. The tanker war in `84, but that`s obviously the 80s. These were all supply-side events and they created questions about availability.
MILLER: Rothman says it is premature to predict crude prices could hit triple digits. But most experts agree the upside for oil depends on how quickly demand starts to slow.
IRA ECKSTEIN, OIL TRADER, AREA INTERNATIONAL: You don`t want to say it, but if the economy slows down, there`s going to be less demand for crude oil. That`s really the only thing that`s going to stop the market is if the economy slows down.
MILLER: If crude surges to $100 a barrel, experts agree it would be disastrous for the economy, decimating nearly every sector from retailers to airlines and possibly kicking off a global recession. Erika Miller, NIGHTLY BUSINESS REPORT, New York.