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Is rallying today jumping nearly 3% to -- just shy of 91 dollars a barrel today we've got an analyst who says prices may be heading even higher.
Joining us now is Tom close OPEC Sachs chief oil analyst thanks for joining us.
Good that I wanna talk about what's going on at the markets because we edition.
-- ticket nice steep climb up and almost 3% while the rest of the market's kind of lying flat waiting for what's happening with the fiscal -- what's driving oil.
Well I think a couple of things you there was there were some my Iranian war games in the Persian gulf.
And I are probably -- leader -- ran I would have war games every week to raise the price by treasury.
There are also was a terrorist cell only and the United Arab Emirates that was.
Arrested in some plot perhaps to.
He -- that the saudis -- the emirates so there was a little bit of tension -- we haven't seen probably since before superstar sandy.
And the cliff was pushed asunder for the moment but I think.
This is a little bit of -- sugar -- I think we may see prices.
Balance higher in the next few months but the real big surge will come in the spring and typically done.
Interest staying because that congress so fiscal -- focus that day international dynamics Harris is starting and still playing -- things.
I want to talk about that little bit more there was a report they came out and in the last month that said that the US could be.
Middle East energy dependent some time in 2035.
But your thoughts on.
Well I think you probably refer to report that -- middle each Middle East independent and I'm not sure about -- 35 but I I think probably by the end of this decade we can become much less depended -- -- However if you had a collapse in prices of the -- six point five or thirty dollars that would change a lot of the calculus.
The oil shale revolution it only works when the price of let's say domestic crude is it is above seventy dollars a barrel so that's -- there.
That's interesting -- you say that it depending upon where prices of oil life do you think it's seventy dollars that we start -- less interest in what's happening which jail.
And -- -- booming -- economy that we've been talking so much and are pinning our GDP growth on.
Units in that neighborhood I mean the exact exact number I'm not sure of -- and if you briefly dropped below seven deal have some of that production increased very in continue for a while because you just don't want shouted -- But I think you remove a lot of the incentives to find that oil.
When WTI goes below seventy and -- some of the discounts for Shiller -- you know there is as high as forty dollars for Iraq.
Actually the tar sands crude in -- so.
Who'd like to drop the probably do -- too much would be a little bit too much of a bad thing.
And similar to what happened with the -- Green energy initiatives they were talking so much a few years ago.
One and bring that picture into the president we've got the short term with the fiscal cliff and then act.
After the fiscal cliff give me what your predictions are as we navigate -- that roller coaster ride that's gonna happen over the next two days.
OK I think we saw the bottom international prices at about three to 41 on the last day of autumn.
And will wobble a little bit higher in the next two months probably get a little sugar rush to start the year -- a lot of money coming into commodities.
Then we'll get typical search that we get from February through April.
I think it'll take it's up to about 375.
But not to some of the highs we've seen in previous years.
And the average price this year is about 361.
I think -- -- less than that next year.
And somewhere between 325 and 375 for the -- so a little bit of goodness.
So the consumer can count on a few extra bucks -- -- pocket and and not being taken out at the -- Yeah and the consumer actually are -- what are your guess sort -- retail sales or consumer spending about her do.
Using about 5% less gasoline in the last four weeks that last year or so it seems as though the high numbers could do about it take patrol at that -- Point I think that's something that a lot of Americans can instantly.
The enthusiastic about paying less at the pump ten -- that -- its chief oil analyst thanks for being with us today they care.
You know of all -- I know I'm gonna (%expletive) off somebody but of all the oil analyst is ago listen most closely and he can't really know how stuff at our.
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