Oil Prices in 5 Years?
I just watched an oil executive on CNN talking about how India and China will increase their oil demand by 10 million barrels per day in 5 years. I was wondering if we would have close to enough oil to fill that demand. In the U.S. oil demand decreased 2% last year in a growing economy due to more efficient new cars. Our new cars are so much more fuel efficient I think you can safely assume that we will continue to reduce our demand every year just by buying new cars and retiring old ones. Also big rigs and corporate and government fleets make up 25% of our oil demand and they are rapidly switching to natural gas. Natural gas is so much cheaper that I think you can expect half of our transportation fleet to be switching to natural gas in 5 years. They are also currently pushing a natural gas transportation bill through congress that has a lot of support. I think you can safely estimate that we will reduce our oil demand by 15 to 30% in the next 5 years. The U.S. is also expected to increase its oil production by 40% in the next 10 years due to horizontal hydraulic fracturing in Texas, Colorado, and North Dakota. Iraq claims that it will be the world's largest oil producer in 10 years when its oil infrastructure gets built out. There are also huge deposits of oil currently being drilled deep off the shores of Brazil. I was wondering if there was some oil expert out there who could give an educated guess as to what the oil prices will be in 5 years given all of these variables?