The global oil market is now seeing prices steadily rising toward the $90 per barrel range, and the possibility of reaching $100 per barrel is “entirely possible,” according to Bob McNally, President at Rapidan Energy, speaking on CNBC’s “Squawk Box” on Monday.
The recent surge in oil prices is reflected value of Alaska North Slope oil, which was above $89 a barrel on Friday and popped up over $90 last week for the first time since November, 2022.
McNally told CNBC the current oil market situation as “climbing a wall of doubt and skepticism,” indicating that even though there are reasons to be skeptical, the market’s fundamentals are driving the increase in prices.
Energy stock traders are particularly attentive to the absence of a notable decline in Russian oil supply, in spite of the G-7 embargo on Russian oil products that went into effect at the start of the year. India, China, and Turkey are still keeping the market for Russian oil strong and Russia is laundering its oil through other countries.
The market dynamics are complex, McNally said, with the market “dancing in a macro minefield.” He pointed to the impact of OPEC+’s production cut policy, warning that it will “put a huge deficit into the market into the second half.”
A veteran global energy expert, McNally is founder and president of Rapidan Energy Group, a Washington-based oil market, policy, and geopolitical consulting firm who last week on CNBC predicted a sharp rally in oil prices in the second half of this year. He also explained last week that China is hoarding oil, pulling in well over one million barrels a day and putting it into a strategic reserve, “because they fear a war next year.”
Saudi Arabia, a significant player in global oil production, is unlikely to reverse announced cuts even if the prices reach $92 per barrel. According to McNally, the Kingdom seems to be waiting to see that “the deficits they are creating are materializing before our eyes” before deciding to apply any brakes to their cuts.
The upward trend in oil prices is a challenge to the Biden Administration, which currently has limited options to reduce gasoline prices for American businesses and consumers. If the national average prices at the pump were to hit $4 per gallon, it could mean the Biden Administration will release even more oil from the Strategic Petroleum Reserve, which is already at its lowest level since its inception.
In addition to Alaska North Slope crude prices inching up, Brent prices have consistently risen for seven straight weeks.
And the Sheep will blame the Oil Companies instead of the idiots in the Illegal Biden/Obama Administration for the High Prices
“It’s one big club, and you ain’t in it.
Oil prices are exclusively controlled by the Saudis, by world events, and by the Russian invasion of Ukraine. Biden can do very little to move prices, so please don’t blame him just because you hate hm. And by the way, Obama isn’t in office anymore, FYI.
US production is at record levels 2023 production is projected to surpass 2019 in production.
No dog oil prices are set by the commodities board. The Wall Street boys come up with oil prices every day. The Saudi’s try to control the amount of oil on the market.
Not officially, but he does have an office down the street. Deep state remains.
He gave away our cushion of oil that protects us from skyrocketing fuel prices you dim Whitt. The reserve is sitting near empty. The Saudis hate his guts as bad as I do, so yes he is partially to blame. The us does help dictate oil prices. You’re an absolute un American moron whidby.
The timing couldnt be better.
If it takes $8/gal gasoline to wake sheeple up and smell the waste in the White House then so be it.
Go ahead and shoot yourself in the foot and keep voting Democrat.
At least the climate will be heavenly while the poor are walking and the Elitests are flying.
I totally agree make gas 10 dollars a gallon. I want to see the sheeple walking and wondering what happened as the limo goes by.
I’m
With you. Let it rip. Turn the electricity off while we are at it. I’m sick of the nonsense. Americans have the most pleasant lives of anyone on earth let’s finish destroying that. Walking sounds good. It will be a great day when the power goes off in the big cities the time is near.
I did like the time not so long ago when the sheep self isolated themselves. The town was peaceful and the traffic was minimal.
All we need is a other event to scare more people into their homes so I can enjoy peqce and freedom without all their bleating.
I’m sure Putin is very happy this happening.
Bet the politicians are rubbing their hands looking at their new money. Don’t expect to benefit from any of this, unless you are a nonprofit, union, government worker, or all three. If you are not, then get busy, or go broke.
The other thing is that north slope production will slow in favor of other markets that are more friendly to production, driving us further down the road to depression. If you think food is expensive now, just wait. If you didn’t dip net or hunt, it will be a hungry winter. If you don’t have a wood stove and oil lamps, a very cold and dark one. If you are on the free handout system then everything is just fine.
This is happening because we keep taking money from the oil companies that drill here. They’re a business like any other, they can’t operate at a loss. We shouldn’t be taking anything from them for all the good they do for us economically. Imagine how strong our economy would be and how cheap gas prices would be if we just stopped taking away all their profit margins.
While I agree that our confiscatory tax policy needs to be reformed and stabilized, the blame for low production and high prices lies solely with the biden administration and their communist eco-terrorist fiends.
is this sarcasm? Seriously US oil production is at record highs. In 2019 when production was at these levels oil was around $65 a barrel Maybe you can explain what taxes have been added since 2019 that the price needs to be $30 a barrel higher. In 2022 the Alyeska Pipeline had its first yearly increase since 2017. Alaska politicians love these prices. Easy to blame Biden. I am pretty sure the only economists that understand oil prices work for the oil companies.
Easy to blame Biden because it’s his fault. Try getting your news from a less biased source and then maybe facts will make more sense.
Regrettably many are starting to
look at this as the new normal. Truly amazing how humans will just unquestioningly follow those heading for the cliff.
I am not filling but your so right dumb sheep going to the slaughter.
This is excellent news. I’ve been a bit disappointed that inflation has notched down a bit so fuel prices at the pump would be wonderful at say….. 6-8 bucks a gallon.
The Chinese are building up their strategic oil reserves, fearing war, while Sloppy Joe will soon have to deplete our oil reserves even further to keep the peasants happy in the Homeland! We have s senile old man in the White House who is more preoccupied with running defense for his corrupt crackhead son, than in running the country. We are in dangerous times.
The only way we can beat people is with our technology. The Chinese, and Asian folks have always been hard workers. And we have become compliance and lazy. If you want to see what I mean, watch YouTube asian bushcraft. We suck at surviving while they prosper.
Welcome to ‘Bidenomics’!
(Known in earlier times as “the poorhouse”.)
Whidbey! Obama isn’t in office anymore?? That’s a joke. Right?
Shouldn’t this be good news for Alaska and other states dependent on oil revenue? Would $30 a barrel be good news for our states economy. Explain that to us like we are in high school. Maybe bring in Brad Keithley to explain how high prices of oil are actually good for the Alaskan economy. If we are paying $2 a gallon for gasoline in Wasilla the number of oil field employees will have been slashed!
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