Analysts See $100 Per Barrel Oil in 2008

01.02.08

At the start of 2008, analysts are forecasting another tense crude market this year with triple-figure records a real prospect. Geopolitical risks are driving prices back towards the $100 level, with a colder-than-usual winter in the northern hemisphere another danger.

Goldman Sachs, one of the most active banks in the energy market, raised its price forecasts for 2008 by $10 in December, with average benchmark US prices now seen at US$95, and they say the price could reach $105 by the end of 2008. The London-based Centre for Global Energy Studies sees an average of about $90 in the first half of the year, with a spike to $100 a possibility.

Analysts at investment bank Merrill Lynch predict average oil prices this year of $82. Some analysts said softening global economic growth, particularly in the US, could help temper price gains. Some feel that OPEC is likely to remain under pressure to bring down prices this year, but the cartel shrugged off calls for more crude at a December meeting in Abu Dhabi.

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