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Originally Posted by albed
OPEC can't "fix" oil prices, it can only set export limits.
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Very true
This is what a market analyst had to say today
cut---The price of crude oil has just reached the highest level of all time.
This is precisely what I told you to expect in Your Roadmap for the Dow, Gold, and Oil which I sent you two weeks ago. That’s where I laid out my targets. Now not only oil, but also gold have set off my buy signals.
Any Wall Street analyst with half a brain should now realize that energy prices have power and momentum ... that there’s no government on the face of the planet that has the will or the power to stop it.
They’re going, going, going!
Moreover, the primary driving force behind energy prices is not terrorism. Nor is Iran, Iraq, North Korea, or hurricane fears.
Those forces are like throwing kerosene on a fire. But the fire was already raging because of the fundamental supply and demand imbalance. That’s what has more than quadrupled the price of oil in the last four years ... and what propelled it to new, all-time highs just yesterday.
Demand Driver #1: The hugely underestimated and misunderstood economic rise of Asia, especially India and China.
I’ve told you how Asia has helped create the strongest global economic growth in 30 years: An estimated 300 million people rose out of poverty in the last ten years in China alone. Overall, 2.3 billion people in Asia are finding new freedoms, new income opportunities, and consuming new goods and services. It’s a tidal wave of demand affecting virtually everything on the planet.
Demand Driver #2: Central bankers around the world are almost universally inflating their economies by systematically devaluing their paper currencies.
As the most indebted country in the history of the industrialized world, the U.S is the worst culprit.
The U.S. dollar now purchases 5% of what it purchased in 1914.
And in the last two weeks alone, the greenback has lost 3% of its value against most of the world’s major currencies.
Since oil is priced in dollars, as the dollar falls in value, the nominal price of oil in today’s dollars must rise.
Where’s oil headed next?
I think it’s going to at least $100 a barrel by the end of this year. And unleaded gas could hit $4 a gallon. In my view, the combination of strong economic growth around the globe plus the most recent plunge in the value of the U.S. dollar — virtually guarantees it.
In 2007, I expect even more upside for oil and gas: $120 a barrel for crude (perhaps even higher), and $5 a gallon at the pump.
If you’re not already in energy shares, consider getting in now. Even though they might seem pricey to a casual observer, the fact is that most oil and gas companies are extremely undervalued, sometimes trading as if oil were still at $20 per barrel and gasoline was still $1.25 per gallon.
The reason: Most analysts and investors figure high energy prices are temporary. So they are underestimating the energy sector’s earnings potential....................../ paste
Take it for what ever it is worth..