Oil pundit Jeff Rubin has long predicted triple digit oil by year-end, and he’s sticking to it.
Although crude prices dropped from $86 to $65-bbl in May, Rubin says on his blog the recent rise to $81.73 will accelerate over the next two months.
Concerns about peak oil will be the main factor:
As I’ve said before, peak oil isn’t a problem if the economy it’s powering is shrinking. Triple-digit oil prices are only a problem if we want the economy they’re fuelling to grow. And most of us do.
Speculators will enable the rapid price increase:
Movements in oil prices have never been linear in the past, and there’s no reason to expect them to be so in the future. The interaction between genuine market forces and financial speculation is a fact of life in virtually all commodity markets.
Speculators have been in the oil market before, and guess what? They’ll soon be back. And it will be the same pull as ever—that of a world ever more desperate for the increasingly expensive fuel that got them on the price bandwagon last cycle and that will soon draw them back again.
Now learn about America’s future oil source: 15 Frightening Facts About The Canadian Tar Sands