Oil Going To $70 By July (Video)

Oil prices have surged by 8% as OPEC agrees to cut back production.

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By EconMatters

We discuss where Oil is headed over the next six months and how producers might want to buy back their hedges before they start losing money big time above $54 a barrel. Producers could lose big on all those hedges they thought were their friend in the oil market!

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6 thoughts on “Oil Going To $70 By July (Video)

  1. Good video. The narrator, apparently an oil market trader, states that “inflation” can take oil back to $100. What he misses is that, in the past two years, there have been historical cuts to existing offshore oil projects(like at the plummet in the stocks of big drillers like Transocean). Since the majority of oil comes from offshore drilling, and, it takes at least two years to go from exploration to production of an offshore well, an oil supply shock very well could see oil spike to historical levels such as $200 or more by 2019.


  2. I’m inclined to agree with your analysis, Peace Frog. That plus the fact that offshore drilling is extremely dangerous both to the environment and human health – if there were a proper regulatory regime in place oil would be so expensive that people would simply abandon their cars for bicycles and public transportation – and electric vehicles for the rich people who could afford them.


  3. Europe has had more success with banning fracking than the U.S., with four countries currently banning it. I do believe that this industry, that is only really 8 or 9 years old, needs more safety regulations (so does offshore drilling which is much older). Electric cars and hybrids are becoming more efficient and cheaper. Oil will not disappear because there is little that can be done in the short and medium term to change the inelastic industrial demand of a trillion dollar industry. However, as with economic reforms, progressive steps can be taken, that in combination, can help people and the environment-if the political will is still exists for such long term decisions. I believe that the carbon credit scheme will only be used to get some people richer. The real advances will come by incentivizing drivers to buy more efficient cars with government rebates, and, to chose higher cost/lower pollution industrial methods of production through government incentives and mandates (China has actually dealt with their big city smog issues by forcing importation of certain industrial metals, for example iron ore, over inefficient and polluting domestic production).


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