Network News

X My Profile
View More Activity





Posted at 12:54 PM ET, 02/23/2011

Unrest in Libya prompts flurry of forecasting about gas and oil prices

By Sarah Halzack

When it comes to the impact of the turmoil in Libya on global oil and gas prices, analysts seem to agree on at least one thing: prices will be driven up. But beyond that, there seems to be little consensus as to exactly how big the increases will be and how long they will last.

With oil prices at a two-year high, here's a roundup of some of the chatter on the Web and in the news on this topic. Tell us in the comments section where you think prices are headed and what you're seeing at gas pumps in your neighborhood.

Analysts interviewed by USA Today had a grim forecast for drivers:

"If this thing escalates and there's a good chance that there'd be a shift in supplies, $5 gas isn't out of the question," says Darin Newsom, senior analyst at energy tracker DTN.

Another energy expert quoted in the same story cites a host of economic factors that, along with the violence in Libya, could lift gas prices:

"If you are looking at the disruption of movement and production in countries such as Saudi Arabia and the UAE, you're easily talking $5 gas," says Peter Beutel, president of energy adviser Cameron Hanover. "We have all the wrong things working together at the right time: an economic recovery, (stocks) making new highs, a lower dollar, strong seasonal demand and unrest in the heart of oil production."

That would mark a sharp uptick from today's average gas price, which AAA says is $3.194 per gallon.

In an appearance on NPR yesterday, Amy Myers Jaffe, director of energy research at Rice University, offered a more conservative prediction:

"My opinion is if we're watching unrest in the Middle East still in May, that we're - I think we're very likely to see, you know, $4 gasoline price."

An academic interviewed by the Associated Press says that prices will swing rapidly between gains and losses:

"Today's situation is reminiscent of the 1970s," said Anthony Michael Sabino, a professor at St. John's University's college of business. "The price of oil will now jump in direct relation to one of its oldest barometers - political tension in the Middle East."

"Expect nothing but a roller coaster ride for a few weeks, if not months."

Bloomberg News reports that Japanese bank Nomura outlines a scenario in which crude oil could reach an eye-popping $220 per barrel:

"If Libya and Algeria were to halt oil production together, prices could peak above $220 a barrel and OPEC spare capacity will be reduced to 2.1 million barrels a day, similar to levels seen during the Gulf war and when prices hit $147 in 2008," the Tokyo-based bank said in a note today.

This forecast, however, seems like a bit of an outlier in comparison to other analyses.

By Sarah Halzack  | February 23, 2011; 12:54 PM ET
 
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Oil prices surge as violence in Libya escalates
Next: Facebook exec, venture capitalist, union leaders among those named to Obama's jobs council

Comments

Why is Wall Street using this to drive up prices?
Libya isn't even in the top 15 of our oil imports!!

Top 15 Countries
CANADA
MEXICO
SAUDI ARABIA
VENEZUELA
NIGERIA
COLOMBIA
ALGERIA
IRAQ
ANGOLA
ECUADOR
BRAZIL
KUWAIT
RUSSIA
UNITED KINGDOM
INDONESIA

Posted by: jsoule | February 23, 2011 2:51 PM | Report abuse

Why and more importantly, WHO is using this to drive up prices?

Libya isn't even in the top 15 of our oil imports!!

Top 15 Countries
CANADA
MEXICO
SAUDI ARABIA
VENEZUELA
NIGERIA
COLOMBIA
ALGERIA
IRAQ
ANGOLA
ECUADOR
BRAZIL
KUWAIT
RUSSIA
UNITED KINGDOM
INDONESIA

Posted by: jsoule | February 23, 2011 2:52 PM | Report abuse

This is just another excuse for the glutten oil companies to make more billions of profit at the people's expense. How are people making 8.00 - 10.00 an hour going to make it. Work one day a week to fill their gas tank? Oh, don't have to worry about that cause most of them will lose their jobs due to the high price of gas - This has gotten so out of control, allowing the oil companies this much power...maybe we need to do some protesting of our own.

Posted by: Anonymous | February 23, 2011 5:08 PM | Report abuse

Post a Comment

We encourage users to analyze, comment on and even challenge washingtonpost.com's articles, blogs, reviews and multimedia features.

User reviews and comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions.




characters remaining

 
 
RSS Feed
Subscribe to The Post

© 2011 The Washington Post Company