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Pilarski says: $40 a barrel, not $400
27 April 2011
Oil prices will climb, but will eventually fall drastically, says Adam Pilarski, senior vice-president, Avitas, in his monthly column.
William Stanley Jevons
In March at the Istat conference in Phoenix I made a number of bold predictions. Some of them I know will not materialize but I made them nonetheless to encourage participants to think about the future in more creative ways.
None of my predictions generated as much controversy as my expressed belief that oil prices will fall below $40 a barrel in less than a decade. A number of prominent aviation executives asked whether I actually meant to say $400 instead of $40/barrel? In fact, I meant $40/barrel, and I am willing to bet on this.
In the short term a $400/barrel oil price is also a distinct possibility. Should the political upheaval in the Middle East spread to Saudi Arabia, panic may set in and lead to a temporary oil price spike reaching unprecedented levels. In the medium to long term though, economic realities will bring prices...
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