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Oil Prices: Profit from the new highs

Posted April 23, 2008

“If we’re only considering economic factors, the steep crude prices now being predicted would be unlikely to stick for any protracted period.” — Martin Hutchinson

by Martin Hutchinson

Baltimore – (TFN): Venezuelan President Hugo Chavez said a few months ago that if the United States invades Iran, we could expect to see oil at $200 a barrel. With oil already approaching the $120 mark, we may get there even without invading Iran.

[Perhaps President Chavez could be tempted out of his chaos-causing rule in Caracas with the offer of a rich and perk-filled oil-analyst’s job at Goldman Sachs Group Inc. (GS: NYSE)].

My colleague - Money Morning Investment Director Keith Fitz-Gerald - agrees with Chavez that oil prices are headed much higher: In fact, since back in December, when crude oil was trading at $90, Fitz-Gerald has been predicting that petroleum prices would reach $187 a barrel. And there’s growing support for his view: In mid-March, Goldman Sachs forecast oil prices of $175 within two years, while just yesterday (Tuesday), noted MSN Moneycentral columnist James Jubak predicted that oil would reach $180 a barrel in the next few years.

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Oil Prices: What’s fueling the rocket?

Crude oil rose to a record $119.90 a barrel on the New York Mercantile Exchange yesterday, as the greenback dropped to an all-time low against the European euro. Crude oil is up 24% so far this year, and 88% from this time last year, Bloomberg News reported.

With this unrelenting march, it’s no wonder that industry observers continue to roll out ever-higher target prices for the “black gold.”

If we’re only considering economic factors, the steep crude prices now being predicted would be unlikely to stick for any protracted period… Read on to learn why.

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Posted by Martin Hutchinson · Filed Under Oil and Energy 

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