Oil settles near $97 per barrel

Yahoo Finance ^ | July 5, 2011 | N/A

[NRG1973]

Some major investment banks are still betting that oil prices will grow next year despite an emergency injection of crude on world markets from the U.S. and other countries.

Higher oil prices should eventually push gasoline prices up as well.

Benchmark crude climbed as high as $97.48 per barrel Tuesday after Barclays Capital raised its 2012 price forecast for Brent crude, used to price many international types of oil. And Goldman Sachs said the International Energy Agency's decision at the end of June to release 60 million barrels of oil from its reserves won't cool off prices as much as originally thought.

Independent oil analysts say prices still could head lower this year. But some think IEA's announcement speaks volumes about its expectations for world oil supplies.

"I think it's an admission from them that Saudi Arabia might not be able to produce enough oil on its own" to meet increased world demand, analyst Stephen Schork said.

Benchmark West Texas Intermediate crude on Tuesday gained $1.95, or 2 percent, to settle at $96.89 per barrel on the New York Mercantile Exchange. In London Brent crude added $2.22 to settle at $113.61 per barrel on the ICE Futures exchange.

Barclays increased its 2012 forecast for Brent crude by $10 to $115 per barrel on Tuesday, saying prices will rise as global oil demand increases. Barclays sees China, India, Saudi Arabia and Brazil as the main sources for demand growth. Barclays actually lowered its expectations for benchmark WTI oil, but its forecast for an average price of $100 per barrel suggests prices are still headed higher this year.

[NRG1973]

If Barclays is correct that crude oil prices will be ~$115 per barrel next year then it means that we released 30 million barrels of oil from the Strategic Petroleum Reserve at ~$93 per barrel and will be putting it back in at $115 per barrel. Another big screwup by our narcissistic president.

[Signalman]

The world uses 88 million barrels of oil per day.

The combined amount of oil released by the U.S and the IEA (60 million barrels) was enough to fuel the world for approximately 16 hours.

[Terry Mross]

You don’t actually believe a liberal can do simple math, do you?

[familyop]

"The combined amount of oil released by the U.S and the IEA (60 million barrels) was enough to fuel the world for approximately 16 hours."

Well said. Yes: 2 million barrels per day for 30 days. It was a probably a propaganda move more than anything else, and it didn't work for long, if at all.