Australia: The oil price is no big deal for toll roads

Apparently the oil price is no big deal for toll roads.

A ring around some of the key operators Transurban, Connect East, Connector Motorways and even the peak body, Infrastructure Partnerships Australia, delivered not one oil price assumption. Even an industry range was out of the question.

Top secret stuff it was.

When a barrel of oil was changing hands for around $US50 back in 2005, Goldman Sachs came out with a report which predicted oil would get to $US100. The report was mocked as if it came from some kind of crackpot peak oil theorist. Now traders are explaining in daily market reports how weak demand has been the reason the oil price slipped under $US100 and peak oil theory is mainstream, though preferably ignored.

And now Goldman, no doubt emboldened by its heroic call on oil from the days when $US50 seemed outrageous, has sallied forth with a ‘’super-spike high-end” price of $US200 a barrel by 2010 should there be supply disruptions. That doesn’t mean it’s right but it is a fair call that oil is on an inexorable trajectory … higher.

The Age