Oil price bubble about to burst: Steve Forbes

And now for a special presentation, my Pappy, Chistopher Radulich responds to Steve Forbes:


My first reaction was to ask what he was smoking when he made that prediction. After careful consideration I still think this is a valid question. Many of the factors that have caused the price of oil to go up will still be in effect next year. The alternative is a world wide recession. Both China and India will still be growing next year and the US economy is also supposed to continue growing. Europe and the rest of the Asian nations are still trying to grow their economy. If the Japanese population ever decides to go into debt and start buying, the Japanese economy will also take off. Meanwhile oil supplies are remaining the same or declining. There is no reason to assume that the situation in Iraq will be any better, which makes their oil at constant risk. oil may go down to $50 a barrel after the mess from the hurricane is corrected but there is only one thing that will bring down the price of oil to what Mr. Forbes says, WORLD WIDE DEPRESSION. Given that option, I'll take oil at $50 to $60 dollars a barrel.

Thanks Pappy, and now Mr. Forbes:

Oil prices are set to crash from this week’s record highs as a speculative market bubble bursts with an impact that could make the IT meltdown of 2000 “look like a picnic”, publisher Steve Forbes said on Tuesday.

Forbes said oil prices, which peaked at more than $70 a barrel on Monday as hurricane Katrina headed for the US Gulf Coast, and which are currently putting a dampner on the US economy, would fall to $30-35 a barrel within a year.

“I’ll make a bold prediction... In 12 months, you’re going to see oil down to $35-40 a barrel,” the publisher of Forbes magazine told reporters.

“It’s a huge bubble, I don’t know what’s going to pop it but eventually it will pop — you cannot go against supply and demand, you cannot go against the fundamentals forever,” Forbes added.

The billionaire magazine publisher’s comments came as the price of crude eased following US government comments that it could release some stock from its Strategic Petroleum Reserve (SPR).

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