>There is one major difference between the Oil and the Gas markets. The Oil market is global, it is priced globally and today it in the '50's.
You don’t have to go back far to find a time when today’s oil prices would have looked very good indeed. On March 25, 2004, for example, CBS Market Watch ran a story with the headline, “Get Used to High Oil Prices.”
"We are in a new era for the price of oil,” the story quoted one analyst as saying.
"Even at these high prices,” he said, “demand has not gone down. In fact, demand is increasing. Right now, I believe this summer is going to be a very, very expensive summer."
The price of a barrel of West Texas Intermediate crude on the day that story was published? $35.67.
So if anyone had said “$50 a barrel oil” to me five years ago, I very definitely would have taken it.
And I suspect that almost all of you in this room would have as well.
The point here is not that current conditions are exceptional in the history of our business….What is exceptional is the environment to which we’ve grown accustomed in the last few years.
BP tracks the price of oil back to 1861, which is just two years after Colonel Drake drilled the first well in Titusville, Pennsylvania. There is only one period in all that time when the price of oil went up for seven consecutive years: 2001 to 2008.
There are many reasons that that happened, of course…
Rising demand in places such as China and India…
Falling production in the US…
And lack of access globally.
So $50 a barrel oil is a disaster?
No.
Lamar McKay
Chairman and President, BP America
Howard Weil Energy Conference
New Orleans, LA
March 25, 2009
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Oil prices bounce back above $58
13 hours ago
LONDON (AFP) — World oil prices rallied Friday, briefly breaching 58 dollars per barrel again, buoyed by better-than-expected jobs data in key energy consumer the United States, traders said.
