Oil Is Going To $100, According To Experts
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Russia’s invasion of Ukraine spiked oil prices to over $100. On March 8, 2022, it reached $127. It spiked over $100 again in June of that year.
Oil recently settled into a consumer-friendly pattern; it fell as low as $56 last December. That is over for now. JPMorgan says crude could go to $120. In a note to clients, Natasha Kaneva, head of global commodities research, said “international Brent benchmark could surge to as high as $120.” MarketWatch reported he also said if the war in the Gulf reaches the point where supplies slow toward zero, “Brent could trade in the $100-.” That could be in as little as three weeks.
Wood Mackenzie had a similar forecast: “Higher oil and gas prices are certain as the closure of the Strait of Hormuz threatens to disrupt 15% of global oil supply and 20% of global LNG supply, with oil prices potentially exceeding $100/bbl if tanker flows are not quickly restored.”
People forget that when the CPI rose 9.1% year over year in June 2022, much of the increase was due to oil. The price of “energy commodities” was up 60.6% for the same period. The crisis of $100 oil is the inflation crisis for the typical consumer, driven by gas prices and home heating oil. In 2022, gas went to $5, briefly
How long will the current conflict be? How long will the US keep troops there? If the Strait of Hormuz is closed for a long time, get ready for more inflation.
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
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A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
