Supply Chain News Bites - Only from SCDigest
 

-April 30, 2010 -

 
 

Supply Chain Graphic of the Week: Are Oil Prices Ready to Fall?

 
  Fears of a Sharp Spike Back Up are Ebbing, BusinessWeek Says; $50-60 Dollars Per Barrel by June, as Inventories Rise?  
     
 

By SCDigest Editorial Staff

 
 

Are oil prices ready to take a big tumble?

The folks at Bloomberg's BusinessWeek think so, noting that inventories are piling up around the world as producers crank up supply even as world demand has still not picked up all that much.

BusinessWeek notes that "Though [oil] prices have recovered, concerns about shortages of crude and a repeat of the 2008 spike to $147 per barrel have eased. Demand in the West appears to have peaked, and China, thirsty as it is, cannot consume all the oil being produced. OPEC members are exceeding their quotas and excess oil is getting stored onshore or in tankers. Some traders are talking about $50-$60 a barrel of oil within 12 months."

 

Source: Bloomberg's BusinessWeek

 

It is interesting to see the opinion that Sausi Arabia does not want oil prices much above $80-90 per barrrel, and would try to open the spigots to drive down prices if oil was to spike to $100 per barrel or more again.

 

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