Hey, you remember me!
This demonstrates the limited value of picking a quote out of a news
story. The issue was short-term prices. I think that the worsened
political situation in Iraq, Nigeria, Ecuador and Iran (nuclear
conflict with West) will keep speculative pressure on the market,
meaning that the weakening fundamentals will not see lower prices
for a few months yet. But you will see $40 this year, IMHO, and
maybe $30. The demand reference was in response to my point, made
last year, that the various forecasts (IEA, etc.) for demand growth
in 2006 seemed overly optimistic. This is now proving out. (I
notice nobody has mentioned Matt's prediction that winter prices
might hit $160, or was it $180?)
I don't know why you think oil production has peaked, though. Sure
doesn't look like it to me.
Mike Lynch

--- In energyresources@yahoogroups.com, "Ron Patterson"
<readyourdarwin@...> wrote:
>
> News Alert! Michael Lynch predicts oil prices to fall below SIXTY
> BUCKS! What a bold prediction, what courage it took for him to
make
> such an earth shattering prediction. Oil prices would have to fall
> over three dollars per barrel for this radical prediction to come
> true.
>
> "The fear that demand would accelerate later this year is fading,"
> said Michael Lynch, president of Strategic Energy & Economic
Research
> in Winchester, Massachusetts. "There will come a point when there
> will be a shortage of storage. We are getting closer to the point
> where you can't ignore the fundamentals, and we'll then see prices
> fall below $60."
> http://tinyurl.com/ly4l9
>
> Of course oil prices are likely to drop below sixty dollars this
> year, they may do it several times. But I wonder what happened to
> Michael's prediction of oil hitting thirty five dollars per barrel
by
> last summer.
>
> Seriously though, everyone is lowering their estimate of oil
demand
> in 2006. Of course it had to happen. High oil prices are beginning
to
> have a strong effect on oil demand. I predict that demand will
fall
> even below the 84.5 mb/d figure predicted by OPEC and others. If
oil
> prices remain in the sixty buck range, and I expect they will,
that
> will mean a demand level of about 84 mb/d, or below, (all liquids)
> and not much more. It will have to fall to that amount because
that
> will be about all the oil extracted per day this year.
>
> Ron Patterson
>