Peak Oil is You

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Page added on February 26, 2009

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Oil: How Low Can It Go?

…As OPEC cuts output and oil companies shelve expansion programs, an oil shortage is coming, says Matthew Simmons. He is founder of Simmons & Co, an investment bank catering to the energy industry.

“Within the next few months, we’ll have a sharp rebound in price,” he said. “[Oil companies] don’t have projects in the mill that can get them ahead of their blind curve. In measurable stocks, we’re basically as tight as a drum. Unless we have a sharp rebound fast, we’ll have an ever-steadier liquidation of useable petroleum stocks until it finally leads to shortages. ”

Simmons estimates that serious shortages could quickly triple or quadruple the price within the next two years–and after that all bets are off. “Somewhere in the next two to five years, $500 a barrel,” he said.


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