GrapeApe

Oil Hits New Record - Is $125 Next, or $100?

I believe that oil with make it to $120/barrel then begin a slow (probably very slow) drop over the next few years. The reasons will be due to the following:

1. The US economic troubles are beginning to affect other nations' economies as well, cause global demand for oil to go down.
2. Oil is becoming the "get rich quick" item and small-shop oil derrick owners, etc. are starting to bring back online oil gathering equipment not used in years. The amount of oil any one can contribute is minimal, but the sum total could notably drive up supplies, thus lowering prices.
3. New oil reserves are being found now that there is such an economic benefit to spending the capital to look for them, and we could soon have much more oil reserves available to drill for that we have had in history.

I think the prices will eventually (again, very slowly) settle at around $85 then begin another multi-year bull run.