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A Barrel Of Oil, Page Contents
Just in case you may have been confused about exactly why the price of a Barrel of Oil just keeps on rising and rising, here are a few interesting Predictions, Reasons and Facts on the subject in simple terms that we can all understand.
Predictions Up To 2012, London Olympics Year And Beyond
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PREDICTION
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OIL
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DATE
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PETROL
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$68 Per Barrel
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01/09/2005
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£0.96 ltr, or £4.34 gal
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$75 Per Barrel
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01/05/2006
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£0.97 ltr, or £4.43 gal
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$80 Per Barrel
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20/07/2006
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£0.99 ltr, or £4.49 gal
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$98 Per Barrel
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08/11/2007
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£1.04 ltr, or £4.71 gal
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$135 Per Barrel
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18/06/2008
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£1.20 ltr, or £5.44 gal
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$410 Per Barrel
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31/08/2012
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£2.01 ltr, or £9.12 gal
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$630 Per Barrel
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31/12/2015
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£2.90 ltr, or £13.15 gal
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Prediction Notes
- Barrel / Litre multplier = 0.00275.
- 1 UK Gallon = 4.536 Litres.
- Increase in Oil Price: 01/09/2005 - 18/06/2008 = 105%.
- Increase in Petrol In UK: 01/09/2005 - 18/06/2008 = 27%.
- Predicted Increase in Energy Costs 01/09/2005 - 31/12/2015 = 820%.
- Predicted Increase in Your Salary 01/09/2009 - 31/12/2015 = 25% - 35%.
- WOW, That Sort of Puts Things Into Perspective - Scary Stuff.
Oil $150+ Per Barrel - Why?
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PROBLEMS/CAUSES
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NIGERIA
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Unrest & Possible Civil War Locking in Supplies.
Nigeria is The Worlds 12th Largest Oil Producer.
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IRAQ
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Civil War, Export Restrictions & Damage to Well Heads and Infrastructure.
Iraq is The Worlds 13th Largest Oil Producer.
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IRAN
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Uranium Enrichment Program and Involvement With Hezbollah in The Lebanon Threatens Sanctions Which Could Result in Conflict and Iran’s Possible Blockade of The Strait of Hormuz, Through Which 60% of The Worlds Oil Must go.
Iran is The Worlds 4th Largest Oil Producer.
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NORTH KOREA
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Nuclear Capable, Missile Tests Threaten Security of US West Coast and Possibly Other Areas.
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ISRAEL
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Middle East Conflict With Hamas & Hezbollah Likely to Draw in Syria & Iran, Destabilising The Whole of The Middle East Oil Producing Region.
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INVESTORS
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Pension Funds, Stocks, Shares, Profits.
More & More Investors Buying in to Oil Will Keep The Price High, Even if Some Issues Resolved.
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DEMAND
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Increasing by Some 8% Per Year Globally, China & India Driving This Along.
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PEAK-OIL
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Oil Supply Currently at Max Production and Will Decrease by Some 2% Per Year in Future, Due to Depletion.
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DISCOVERY
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We Only Find 1 New Barrel of Oil For Every 4 That We Loose Through Depletion.
Investment in Discovery Currently at an All Time Low. Oil Companies Are Loathed to Put in Money When Returns Will be Low.
We Have Already Found 90% of The Oil That Takes Only 10% Effort to Extract. The Remaining 10% Will Take 90% Effort.
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GLOBAL WARMING
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Increases Hurricane Severity in The Gulf of Mexico. This Impacts Oil, Gas & Petroleum Production on The Gulf Coast. The Hurricane Season Runs From 1st June to 30 November.
The USA is The Worlds 3rd Largest Oil Producer
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REFINING
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No New Oil Refineries Have Been Built For Over 20 Years in The USA and Many Now Need Regular Additional Shutdown Periods.
It takes 5 Years to Build an Oil Refinery.
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CREDIT CRUNCH
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Investment Funds Will Use Commodities, Such As Oil, To Hedge (Offset Losses) Against Other Temporarily Less Profitable Funds.
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DOLLAR WEAKNESS
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Oil Is Priced In Dollars ($), So If The Dollar Falls Against Other Major Currencies (UK Pound And The Euro), Its Price In Dollars Will Increase To Make Up The Difference.
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BRAZIL
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Strikes And Unrest Among Brazil’s Oil Workers Is Commonplace.
Brazil Is Currently The 24th Largest Oil Producer In The World, But Recent Finds Will Propel It Into The Top Ten, Along With Nigeria And Venezuela.
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Oil $150+ Per Barrel - Why Not?
Given the above situations there is no reason at all why Oil will stop its inexorable rise toward $150 and beyond...
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