Energy execs worry oil rise just mood swing

HOUSTON (Reuters) – A broad consensus about the need for oil prices to rise over time is not reassuring energy experts, who worry that the recent rally is driven simply by an improving “mood,” and therefore very fragile.

Energy executives at the Reuters Global Energy Summit this week sounded unnerved by a surge in the U.S. benchmark oil price near $70 per barrel which, while less than half its peak last July, is double its level of mid-February.

That increase has come despite rising crude stockpiles and amid few signs that the world economy will turn around dramatically any time soon, they said.

“It does kind of feel like the market is getting ahead of itself. The demand has not increased,” Larry Nichols, chief executive of Devon Energy Corp, said. “One can say that the rate of decline has slowed down — that does not mean that the rate of decline has stopped.”

Reuters