November 05, 2005
Here’s a pretty good indicator of why BP is not rushing to invest in new production of oil:
The price of oil is grossly inflated and due for a tumble as fresh supplies come on stream and users switch to other forms of energy, BP warned yesterday.
Lord Browne, BP's chief executive, said crude was likely to fall from its current level of around $60 a barrel to nearer $40, and even lower in the long run.
"Our view is the price of oil is unsustainably high and will come down," he told an energy forum in Singapore.
He may be right (I certainly think he is) and he may be wrong but if that’s the way the feel inside BP then they’re not going to be throwing money at projects marginal at current prices now are they?
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What are the futures markets saying?
Posted by: Rub-a-dub | Nov 5, 2005 2:00:13 PM