Oil at $100 May Look “Cheap” Within Five Years, Bank Exec Says

Oil at $100 May Look “Cheap” Within Five Years, Bank Exec Says

By Michelle Krebs February 21, 2008

Crude-oil prices of $100 may look cheap within five years if OPEC production fails to keep pace with global demand growth, said Ronald Smith, head of Moscow-based research for Alfa Bank, in an interview with Bloomberg television.

“We may hit peak oil in the course of the next three, four or five years, in which case $100 oil will look somewhat quaint,” he said.

Some forecasts indicate Saudi Arabia, the largest producer in the Organization of Petroleum Exporting Countries, may be unable to reach sustainable output of 15 million barrels a day and fail to meet an annual demand increase of 1.5 million barrels a day, Smith said.

Michelle Krebs:  is Editor-in-Chief of AutoObserver.com. Follow @AutoObserver on Twitter.