Comment 27952

By jb (anonymous) | Posted December 20, 2008 at 15:36:30

Ryan:

I believe you are 100% correct in your analysis. The fact that there have been discoveries in Brazil and elsewhere simply move the peak ahead a bit just as civil unrest in producer nations move it back.

Of further note is that the Brazilian oil field find is very expensive to produce (as are various existing field recovery technologies) making these finds and discoveries a factor only after prices have stabilized at a point where investments in theses areas pay off.

There are so many factors and unknowns that I seriously anyone can predict the size and shape of the upcoming oil price curve but I am convinced the rapid rise last summer and unbelievably rapid decline can only be explained by bumping up against supply limits of a very desirable commodity on which people are so dependent they will pay whatever they can to get it.

The futile attempts of OPEC to restrict supply when prices are down only strengthens my opinion that when prices were $145/bbl every last sellable drop of oil was put on the market.

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