Oil could hit $200 in ’super-spike’

Oil prices threaten to hit $200 a barrel in a final “super-spike” over coming months as producers fail to keep pace with blistering demand from China and the Middle East, according to a controversial report by Goldman Sachs.

We believe the current energy crisis may be coming to a head. A ’super-spike’ end game may be in the early stages of playing out,” said Arjun Murti, the bank’s energy strategist.

Goldman Sachs said a chronic lack of supply would lead to a “dramatic and continuous rise in oil prices”, followed at some point by a sharp fall in oil demand as consumers retrench.

…Non-OPEC producers have lurched from one disappointment to another. Russia’s output fell 150,000 barrels per day in April compared to a year earlier, confirming warnings from industry leaders that Russia’s oil infrastructure is woefully deficient.

“The possibility of $150-$200 per barrel seems increasingly likely over the next six to 24 months. A gradual rally in prices is likely to be longer-lasting than a sharp sudden spike,” said Goldman Sachs.

Telegraph