back to blog homepage

Department of Energy Oil Analysis

Below is an article that quotes the Department of Energy's current report on oil prices. The current selling is clearly overdone and we are due for a major move up in energy stock prices based upon their report.

October 07, 2008

Department Of Energy Predicts Large Increase In Oil Prices

Tx00338coilwellgusherodessatexasp_2It is hard to believe that crude prices would drop from $147 this summer to under $90.

The Department of Energy believes prices will move back up. The agency now predicts that West Texas Intermediate (WTI) crude oil prices will average about $112 per barrel in both 2008 and 2009.

Unless the global economy is weaker than anticipated, EIA expects that the call on Organization of the Petroleum Exporting Countries’ (OPEC) crude oil will exceed OPEC crude oil production over the next 6 months.

Global oil consumption is projected to rise by about 300,000 barrels per day (bbl/d) in 2008 and by almost 800,000 bbl/d in 2009 compared with year-earlier levels.

Solid growth in non-OECD countries, especially China, Latin America, and oil-exporting countries in the Middle East, is partly offset by sharp declines in U.S. oil consumption as well as lower oil consumption in many other OECD (Organization for Economic Cooperation and Development) countries.