The belief that the world’s oil supply is close to an irreversible drop is no longer “on the fringes” of the market, said a research report by New York-based [Goldman Sachs analyst] Murti, who forecasts oil of $50 to $105 a barrel until 2009. UBS AG analyst James Hubbard, a former oil engineer at Schlumberger Ltd., said an inevitable decline in supply will start sooner and be worse than expected unless investment increases for many years.
A jump above $105 a barrel “is possible if we don’t invest the right amount of money,” Hubbard said in an interview in London. “There will be a peak in production earlier than expected, and that post-peak decline will be more dramatic than currently assumed unless there is a sustained increase in investment in oil and gas production, greater consumer efficiency and alternative energy sources.”
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