The experts in the US government have finally come around to the reality that oil prices are not going to drop. And, they could stay high for a very, very long time.
"You’ve got this global market still operating at very low spare (oil production) capacity, all of which is in Saudi Arabia," Guy Caruso, head of the Energy Information Administration told Reuters.
It is a classic case of the government getting to the barn doors after all of the horses are gone and part of the reason that the Feds are slow to address the issues that keep crude prices up higher than most analysts ever dreamed they would get.
Perhaps that EIA missed the rising demand for crude in China and India and the slowing production out of Mexico, Indonesia, and Russia.
As the agency acknowledges the problem now, no one benefits.
Douglas A. McIntyre
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