Events Calendar
In This Section
Can DNA tests free ex-Akron captain?
Zips' Porter creates culture of success
Health reform passes hurdle in Senate
Lawyers compare four cases to Prade's
Visiting new Navy ship brings back memories for Doylestown man serves on USS New York in 1930s
Green High senior goes extra mile for those who walk and jog the park trails
Most Read Stories
Police accuse bank robbery suspect of gobbling up note (with dashcam video)
Dad accused of forcing son into field, killing him
Man found dead in North Akron home is identified
Victim of beating in Kent last week is declared dead at Akron hospital
Coventry man killed in crash at I-77 ramp
Browns' roster nearly devoid of consistent players
College student mistaken for deer, shot to death
NFL star Chris Spielman's wife loses cancer battle
Blogs:
Pets:
Cat-loving chihuahua suckles seven abandoned kittens
The Heldenfiles:
Friday Night Notebook
Patrick McManamon:
For your Saturday entertainment …
Akron Zips:
Hitchens leads Zips in second-half comeback
Tribe Matters:
Seven players added to Tribe’s 40-man roster
Cleveland Browns:
Holmgren expresses interest in Browns position
Kent State Sports:
Kent State blown out in second half, loses to Temple 47-13
Cleveland Cavaliers:
Gameblog: Cavs vs. Philadelphia 76ers
Buckeye Blogging:
OSU – Michigan college football rivals meet in Baghdad
Varsity Letters:
Four area football teams play tonight
All Da King's Men:
Headed For Disaster
Blog of Mass Destruction:
Will Health Care Reform Pass?
Akron Law Café:
Health Care Financing Reform: (69) The Brookings Institute Study on "Bending the Curve" – Four General Strategies
See Jane Style:
Vintage Chic
Car Chase:
TIME TO GET YOUR COLLECTOR CARS WINTERIZED
Let's Talk Real Estate:
Silverdome Potentially SOLD!
Ohio Travels with Betty:
George is looking for a Thanksgiving buffet in Akron.
Sound Check:
Steely Dan Plays "The Royal Scam" at E.J. Thomas Hall
HRLite House:
Colloquium at University of Akron
Akron Gamer:
Nintendo's Mario endures even as games come and go
Goldman Sachs predicts up to $200 a barrel within two years. Gas prices edge lower
By John Wilen
Associated Press
Published on Wednesday, May 07, 2008
NEW YORK: Oil futures blasted to a record near $123 a barrel Tuesday, gaining momentum as investors bought on a forecast of much higher prices and on any news hinting at supply shortages.
Retail gasoline prices edged lower, but appear poised to rise to records of their own in coming weeks.
A new Goldman Sachs prediction that oil prices could rise to $150 to $200 within two years seemed to motivate much of Tuesday's buying, although a falling dollar and increasing concerns about declining crude production in Mexico and Russia contributed, analysts said.
The Energy Department raised its oil and gasoline price forecasts, but also predicted that high prices will cut demand more than previously thought.
Light, sweet crude for June delivery jumped to a record of $122.73 a barrel before retreating to settle up $1.87 at $121.84 on the New York Mercantile Exchange.
Oil prices have nearly doubled from about $62 a barrel a year ago, which Goldman sees as a sign that the world is in the midst of a ''super spike'' in oil prices.
Analyst Arjun Murti said in a research note released Monday that prices would ultimately force demand to fall sharply.
Not everyone shares Goldman's view. Tim Evans, an analyst at Citigroup Inc., countered Goldman's analysis with a note predicting that crude prices could as easily fall to $40 a barrel as rise to $200 over the next two years, because supplies are, as Evans put it, comfortable.
James Cordier, president of Tampa, Fla., trading firms Liberty Trading Group and OptionSellers.com, said Goldman's prediction isn't necessarily new.
''We've heard numbers like these out of Goldman Sachs, especially over the last 12 months,'' he said.
Indeed, it's not the first time Murti has espoused a super spike theory; in an April 2005 note, he
predicted the oil market was in the early stages of an unprecedented rally that would send prices from a then-record of about $57 a barrel to $105.
But some investors respond to such predictions by buying, Cordier said.
Meanwhile, in a monthly report, the Energy Department's Energy Information Administration predicted oil prices will average $110 a barrel this year, up $9 from last month's forecast. The EIA also said high prices will cut U.S. demand for petroleum products by 330,000 barrels a day this year; last month, the EIA predicted U.S. petroleum consumption would fall by 210,000 barrels a day.
But strong demand for oil from countries such as China, India, Russia, Brazil and in the Middle East will support high prices and keep global oil demand growing by about 1.2 million barrels a day this year, unchanged from last month's forecast, the EIA said.
A falling dollar on Tuesday also gave traders reason to buy. Investors often buy commodities such as oil as a hedge against inflation when the dollar falls, and a weaker greenback makes oil cheaper to investors overseas. Many analysts feel the dollar's protracted decline is the real reason oil prices have nearly doubled since last year.
At the pump, meanwhile, the national average price of a gallon of regular gas slipped 0.1 cent overnight to $3.61, according to AAA and the Oil Price Information Service. Analysts are split over how high gas will go; while prices have slipped lower since May 1, leading some analysts to say gas is close to peaking, others predict the fuel will follow oil's upward surge.
The EIA said gas prices will peak at a monthly average of about $3.73 a gallon in June, about 13 cents higher than its previous forecast.
NEW YORK: Oil futures blasted to a record near $123 a barrel Tuesday, gaining momentum as investors bought on a forecast of much higher prices and on any news hinting at supply shortages.
Get the full article here.
