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Oil Prices Near 9-Month High

Greek deal, Iran crisis contribute to surge.

by on Feb.21, 2012

Prices in California could soon near last year's peak.

Oil prices are approaching a 9-month high raising the specter that gas could again top $4 a gallon in the weeks ahead.

The latest surge follows the early morning agreement to resolve the Greek debt crisis along with Iran’s decision to halt petroleum exports to both Britain and France.  Iran currently provides about 18% of the oil used by the European Union but is threatening to further tighten supplies in retaliation for sanctions meant to block its nuclear energy program.

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With oil floating around $105 a barrel on Tuesday morning trading, there is also a growing likelihood that gas prices could become a key issue in the upcoming U.S. presidential election, GOP candidate Newt Gingrich tweeting his followers that, “gas prices are unacceptable”.

Petroleum has been moving up for weeks but the latest surge began when Iran announced a halt to exports to Britain and France, both strong supporters of sanctions aimed at getting Iran to back down on what many believe to be a program to develop nuclear weapons.

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U.S. Motorists Driving Less, Spending More

Fuel prices barely respond as fuel consumption slips.

by on Jul.13, 2011

Americans are driving less but still paying more.

Whatever happened to the law of supply-and-demand?  Despite a notable reduction in the amount Americans are driving, fuel prices have not responded in traditional fashion and are, if anything, continuing to rise after a brief respite.

The Benchmark West Texas Intermediate Crude jumped more than 2% on Tuesday, climbing $2.28 a barrel, to $97.43.  In Europe, closely-watched Ice Brent Crude did slip slightly in early Wednesday trading, but had still climbed to $117.36 a barrel.

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Many economists had expected the oil price numbers to keep falling, as they did leading up to the beginning of the month, reflecting worsening economic news around the world – which often translates into reduced demand.  In earlier times, prices almost certainly would have slumped on word that U.S. motorists have continued curbing their driving – now for the fourth month in a row.

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Energy Execs See Big Increases to Come in Oil Prices

Two-thirds see petroleum topping $120 a barrel.

by on May.20, 2011

 

Expect to be paying more for what's pumped out of the ground, oil industry execs warn.

Weary Americans will likely see prices at the pump continuing to soar, according to a survey of 550 energy industry executives, though not necessarily to the record levels of mid-2008.

Nonetheless, with 64% anticipating crude oil will reach $121 a barrel this year – about 20% more than it’s been trading at lately – that will almost certainly mean more pain at the pump, where U.S. motorists are now paying an average of around $4 per gallon for self-serve regular.

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As might be expected at a time when the Mideast is in turmoil, Western economies are showing new signs of instability, and emerging markets are demanding a bigger share of the barrel, oil prices are more unstable than they have been in years – a fact reflected in the results of the survey by the KPMG Global Energy Institute.

While a third of the executives predicted oil prices will peak between $121 and $130 a barrel, another third see even higher prices coming.  A full 17% foresaw a high of as much as $140, while 9% thought oil would reach a peak of $150.  On the fringe, 6% thought crude would go even higher.

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