Goldman: Costly oil not a bubble

The surge in oil prices during the past year is backed by the economics of supply and demand rather than the result of a short-lived bubble, the global head of commodities research at Goldman Sachs said Monday.

“The fundamental shift is not a bubble generated by speculation, but that of a systematic upward shift in the long-term price of oil,” Jeff Currie, a managing director at top energy derivatives trader Goldman, told an energy conference.

Indeed, the world exhausted its supply of cheap oil several years ago, he said.