WTIC (West Texas Intermediate Crude) Oil continues to stair step upwards. All the talk of USA increasing drilling is so far amounting to nothing with respect to lower prices.
WTIC, weekly, 5yr
WTIC, monthly, 20yr, historic
It is amazing to look at the twenty year chart for Oil. There sure have been some crazy swings along the way, but the broad trend remains UP. Aside from those who believe in Abiotic oil 'magically appearing in the Earths Crust', Peak Oil is a serious and critical resource problem for the world in the decades ahead.
Considering that 'everything' is supposedly okay right now, the economy is growing - although not that much, and yet Oil prices are still very much holding over $100.
There is also always the threat of 'an event' in the middle east, and across the years ahead, that does seem likely. Whether it is next month, or in 2020, it really doesn't matter in the scheme of things. What does matter is that Oil prices look set to hit much higher levels in the years ahead.
Looking for a break above $115
From a technical/chart perspective, Oil bulls need to see a few consecutive closes over the May'2011 high of $114.83. If we see WTIC hit $115..and hold over, then a re-test of the 2008 commodity peak high of $147 seems very probable.
Were an 'event' to occur...there seems pretty much an agreed outlook that Oil would jump overnight by many tens of dollars, maybe even a direct gap right over $147...and then quickly to $200+. For the world economy, the consequences of such a price, are of course the stuff of nightmares...and 'doomer' movies.
Goodnight from London