$130 Per Barrel WTI Crude Prices May be Possible in the Coming Months

Citizens for Affordable Energy’s founder and chief executive officer Mr. John Hofmeister said that West Texas Intermediate crude oil prices may reach the $130 per barrel mark in the coming six months.

Hofmeister, Royal Dutch Shell Plc’s former executive, expressed in a CNBC interview that oil demand keeps on increasing in Asia regardless of the amount of oil being consumed. As a result of this, crude prices continue to grow since the supply is not sufficient to meet the demand.

He further added that domestic US production of natural gas and oil have slightly increased due to the output of shale. However, according to Hofmeister, the scale of this new source of supply is not enough to meet the demand needed.

In the New York Mercantile Exchange (NYMEX), current crude oil prices for delivery in March reached $105.44. That is an increase of $2.20 and is the highest crude price level since the 5th of May.

Hofmeister as Shell Oil’s former president questioned the spare output capacity’s availability that is being claimed by OPEC – or the Organization of Petroleum Exporting Countries.

In his interview, Hofmeister said that he thinks that OPEC is almost maxed out. He added that every time people discuss regarding OPEC’s spare capacity, he just does not see it. He reiterated that since he does not see it in the numbers, he is also not sure if it is actually there.

According to Hofmeister, countries in the West will economically struggle due to high diesel and gasoline prices in the middle parts of the year.

Hofmeister said in his CNBC interview that the Persian Gulf’s bad boys will work destructively. They are aiming for the West undergoing economic difficulties. This will start in the summer and Iran will be in middle of all of it.

By Chris Termeer

Chris Termeer

Chris Termeer is an oil and gas consultant, industry commentator and analyst. His book, Fundamentals of Investing in Oil and Gas provides a comprehensive overview of all aspects of the oil and gas industry, including exploration, drilling, production, storage, transportation and refining, to name but a few.

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