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Energy Literacy Advocates (ELA) is a non-partisan, non-profit, public education and advocacy group dedicated to improving the energy literacy of all sectors of our democracy in order to empower a comprehensive national energy policy that is responsible and sustainable. Stay tuned for updated energy news!
Monday, October 19, 2009
A New Lowest Price Set for Oil?
As oil rises for the third week in a row, and gasoline prices jump against historical trends, have we established a new floor for oil prices?
Industry and economic analysts predict that $70 a barrel is the new "bargain price" on oil. Lower than that, and oil producers can't fund exploration and development. Oil companies slash dividends. Taxes from governments and exploration constrictions raise new project costs. Oil wells are capped. Economically, the $20 a barrel price of oil, which reigned in the 1990s, is a thing of the past.
Adding to the new floor is the need to replace declining production in established oil fields. 3.5 million barrels a day of new production is needed annually to offset the loss in production from old fields.
For more on this story in The New York Times, click here.
Industry and economic analysts predict that $70 a barrel is the new "bargain price" on oil. Lower than that, and oil producers can't fund exploration and development. Oil companies slash dividends. Taxes from governments and exploration constrictions raise new project costs. Oil wells are capped. Economically, the $20 a barrel price of oil, which reigned in the 1990s, is a thing of the past.
Adding to the new floor is the need to replace declining production in established oil fields. 3.5 million barrels a day of new production is needed annually to offset the loss in production from old fields.
For more on this story in The New York Times, click here.
Labels: oil companies, oil price, oil supply, oil supply/demand, peak oil
posted by Amanda Voss at 4:38 PM
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