$200 barrel oil in 2008? Bets are on …

$200 options for oil purchases have gotten hot, with a ten-fold increase in the past several months according to Sydney Morning-Herald reporting. Don’t worry, of course, since at $100, oil remains cheap …

“One hundred dollars a barrel is actually 14.9 cents a cup, so we’re still talking about oil being remarkably cheap,” said Matthew Simmons, the chairman of Simmons & Co International

Yes, oil is much cheaper than a good Bordeaux, by volume, at least.

The reality is that global demand continues to grow (perhaps to be impacted by a US (and global?) recession in the coming year), expected to be up about 2.5 percent in 2008 over 2007.  And, at the same time, production is tightening. 

Oil forecasters say there is no chance of $US200 crude, as the US, which consumes a quarter of the world’s oil, slows.

Note that this article doesn’t (as don’t most oil-related articles) Peak Oil.  Speak No Evil … Hear No Evil … See No Evil.  The business journalist community is, for the most part, blind to the peril of Peak Oil.


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