The Oil Drum

Look at this and tell me it will not end in tears:

Jerome, in the financial world nothing is obvious. If you think otherwise you are going to lose a lot of money.

Five years ago, OPECs stated goal was to maintain the price of oil between $22-$28 per barrel. People thought that oil at $35 per barrel was a calamity. Here we are at $70 per barrel and the global economy is doing fine. Yeah I know that Senegal and Nepal are beginning to have problems, but most people thought that even the economies of developed world would take a big hit above $40/barrel.

So what prediction would you have made for the financial markets if you knew in 2002 that the price of oil was going to be around $70 per barrel in 2007?

We all know that debt cannot grow forever and oil will not last forever, but no one can use that to time the collapse of financial markets. It could last a lot longer than most people here imagine.