The idea that oil might hit $120 was the stuff of fairy tale and lying around the poker table. At least up until now. A new Reuters poll of analysts shows that many of them have gone to the Dark Side to join oil price pessimists.
Esteemed thinkers from German bank Landesbank Baden-Wuerttemberg put their average number for the year at $107. Societe Generale moved its estimate to $101.20 from its previous number of $80.92.
The French bank went so far as to say that, under its current estimates, oil could spike to $115 to $120.
All of the numbers are based on the same assumptions to one degree or another. China and India will continue to suck supply. Even a US slowdown will not significantly drop the need for oil here. OPEC will not raise production. Despots and pipeline explosions will become a bigger part of the global crude scene.
If Wall Street firms keep raising its targets, its analysts may have to work from home. They won’t be able to afford the gas to get to work.
Douglas A. McIntyre